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Fluor Corp (FLR) SEC Filing 10-Q Quarterly Report for the period ending Thursday, September 30, 2021

SEC Filings

Fluor Corp

CIK: 1124198 Ticker: FLR

 

Exhibit 99.1

 

Fluor Corporation Brian Mershon
6700 Las Colinas Blvd Media Relations
Irving, Texas 75039 469.398.7621 tel
   
469.398.7000 main tel Jason Landkamer
Investor Relations
469.398.7222 tel

 

 
News Release

 

FLUOR RAISES 2021 GUIDANCE AND REPORTS SECOND QUARTER 2021 RESULTS

 

·Q2 2021 loss per share from continuing operations of $0.08; adjusted EPS from continuing operations of $0.32; raising full year adjusted EPS guidance to $0.60 to $0.80 per diluted share
   
·$600 million convertible preferred offering supports debt reduction strategy; $26 million reduction through July, anticipate substantial debt retirements in 2021
   
·$192 million received in outside investment for NuScale this year
   
·$100 million in proceeds for the sale of AMECO North America and a P3 investment; AMECO South America and Stork divestitures underway

 

IRVING, TX (August 6, 2021)

- Fluor Corporation (NYSE: FLR) announced financial results for its second quarter ended June 30, 2021. Revenue for the quarter was $3.2 billion, with a net loss from continuing operations of $14 million, or $0.08 per common share. Results for the quarter include a charge related to a legacy infrastructure project. Results were also negatively impacted by $49 million of foreign currency effects and certain other adjustments outlined in the table at the end of this release. Excluding the $49 million of other adjustments, and using the higher diluted weighted average share count for this level of earnings, adjusted earnings per diluted share were $0.32. The weighted average share count for the second quarter of 156 million reflects the effect of the convertible preferred offering. Consolidated segment profit for the quarter, which includes NuScale expenses, was $67.2 million compared to $72.4 million in the second quarter of 2020.

 


The following information was filed by Fluor Corp (FLR) on Friday, August 6, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2021
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
(Exact name of registrant as specified in its charter)
Delaware 33-0927079
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6700 Las Colinas Boulevard  
Irving, Texas 75039
(Address of principal executive offices) (Zip Code)
469-398-7000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolsName of Each Exchange on Which Registered
Common Stock, $.01 par value per shareFLRNew York Stock Exchange
1.750% Senior Notes due 2023FLR 23New York Stock Exchange
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 ý  No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ý  No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer Accelerated filer
Non-accelerated filerSmaller reporting company
 Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes   No ý
As of October 29, 2021, 141,411,916 shares of the registrant’s common stock, $0.01 par value, were outstanding.



FLUOR CORPORATION
FORM 10-Q
TABLE OF CONTENTSPAGE

1

Glossary of Terms
The definitions and abbreviations set forth below apply to the indicated terms used throughout this filing.
Abbreviation/TermDefinition
2020 10-KAnnual Report on Form 10-K for the year ended December 31, 2020
2020 PeriodNine months ended September 30, 2020
2020 QuarterThree months ended September 30, 2020
2021 PeriodNine months ended September 30, 2021
2021 QuarterThree months ended September 30, 2021
3METhree months ended
9MENine months ended
AOCIAccumulated other comprehensive income (loss)
ASCAccounting Standards Codification
ASUAccounting Standards Update
Cont OpsContinuing operations
CPSConvertible preferred stock
COVIDCoronavirus pandemic
DB planDefined benefit pension plan
Disc OpsDiscontinued operations
DOEU.S. Department of Energy
EPCEngineering, procurement and construction
EPSEarnings (loss) per share
Exchange ActSecurities Exchange Act of 1934
FluorFluor Corporation and subsidiaries
G&AGeneral and administrative expense
GAAPAccounting principles generally accepted in the United States
ICFRInternal control over financial reporting
LNGLiquefied natural gas
NCINoncontrolling interests
NMNot meaningful
NuScaleNuScale Power, LLC
OCIOther comprehensive income (loss)
PP&EProperty, plant and equipment
Q3 2021 10-QQuarterly Report on Form 10-Q for the quarter ended September 30, 2021
RSURestricted stock unit
RUPORemaining unsatisfied performance obligations
SECSecurities and Exchange Commission
StorkStork Holding B.V. and subsidiaries
SMRSmall modular reactor
VIEVariable interest entity

2

PART I:  FINANCIAL INFORMATION
Item 1. Financial Statements
FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
UNAUDITED

3ME
September 30,
9ME
September 30,
(in thousands, except per share amounts)2021202020212020
Revenue$3,103,085 $3,456,938 $9,278,017 $10,889,575 
Cost of revenue2,996,602 3,324,363 9,019,291 10,614,259 
Gross profit106,483 132,575 258,726 275,316 
G&A(42,371)(36,697)(139,439)(112,853)
Impairment, restructuring and other exit costs— — (26,392)(106,189)
Foreign currency gain (loss)37,453 (29,763)(4,203)16,197 
Operating profit101,565 66,115 88,692 72,471 
Interest expense(35,579)(15,650)(71,521)(47,908)
Interest income4,209 3,762 12,266 20,980 
Earnings (loss) from Cont Ops before taxes70,195 54,227 29,437 45,543 
Income tax expense (benefit)26,973 28,516 28,799 (2,406)
Net earnings (loss) from Cont Ops43,222 25,711 638 47,949 
Less: Net earnings (loss) from Cont Ops attributable to NCI
(3,508)4,193 21,549 19,743 
Net earnings (loss) from Cont Ops attributable to Fluor46,730 21,518 (20,911)28,206 
Net earnings (loss) from Disc Ops attributable to Fluor (6,261)(2,177)(140,090)(299,814)
Net earnings (loss) attributable to Fluor$40,469 $19,341 $(161,001)$(271,608)
Less: Dividends on CPS9,750 — 14,625 — 
Net earnings (loss) available to Fluor common stockholders$30,719 $19,341 $(175,626)$(271,608)
Basic EPS available to Fluor common stockholders
Net earnings (loss) from Cont Ops$0.26 $0.15 $(0.25)$0.20 
Net earnings (loss) from Disc Ops(0.04)(0.01)(0.99)(2.13)
Diluted EPS available to Fluor common stockholders
Net earnings (loss) from Cont Ops$0.26 $0.15 $(0.25)$0.20 
Net earnings (loss) from Disc Ops(0.04)(0.01)(0.99)(2.13)

The accompanying notes are an integral part of these financial statements.

3

FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
UNAUDITED
3ME
September 30,
9ME
September 30,
(in thousands)2021202020212020
Net earnings (loss) from Cont Ops$43,222 $25,711 $638 $47,949 
Net earnings (loss) from Disc Ops(5,872)(2,071)(139,110)(299,021)
Net earnings (loss)$37,350 $23,640 $(138,472)$(251,072)
OCI, net of tax:
Foreign currency translation adjustment(18,712)4,201 (17,292)(75,828)
Ownership share of equity method investees’ OCI(2,973)(34)(5,112)(18,860)
DB plan adjustments1,163 1,070 4,005 3,071 
Unrealized gain (loss) on hedges(2,279)9,588 (4,755)5,883 
Total OCI, net of tax(22,801)14,825 (23,154)(85,734)
Comprehensive income (loss)14,549 38,465 (161,626)(336,806)
Less: Comprehensive income (loss) attributable to NCI(764)3,804 24,288 18,245 
Comprehensive income (loss) attributable to Fluor$15,313 $34,661 $(185,914)$(355,051)
The accompanying notes are an integral part of these financial statements.

4

FLUOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
UNAUDITED
(in thousands, except share and per share amounts)September 30,
2021
December 31,
2020
ASSETS   
Current assets  
Cash and cash equivalents ($700,554 and $654,852 related to VIEs)
$2,125,515 $2,198,781 
Marketable securities ($30,066 and $66 related to VIEs)
67,164 23,345 
Accounts receivable, net ($208,700 and $238,376 related to VIEs)
838,425 935,676 
Contract assets ($320,616 and $237,923 related to VIEs)
1,012,109 859,675 
Other current assets ($22,300 and $29,408 related to VIEs)
389,519 378,043 
Current assets held for sale848,653 638,489 
Total current assets5,281,385 5,034,009 
Noncurrent assets
PP&E, net ($37,917 and $34,847 related to VIEs)
425,633 463,827 
Investments718,555 527,416 
Deferred taxes50,826 77,915 
Deferred compensation trusts321,711 350,427 
Goodwill206,660 207,369 
Other assets ($38,565 and $40,829 related to VIEs)
253,313 269,610 
Noncurrent assets held for sale— 379,239 
Total noncurrent assets1,976,698 2,275,803 
Total assets$7,258,083 $7,309,812 
LIABILITIES AND EQUITY 
Current liabilities
Accounts payable ($292,524 and $328,940 related to VIEs)
$1,117,493 $1,115,625 
Short-term borrowings4,639 4,890 
Contract liabilities ($334,168 and $262,811 related to VIEs)
1,071,812 1,093,761 
Accrued salaries, wages and benefits ($26,168 and $28,381 related to VIEs)
513,710 578,827 
Other accrued liabilities ($16,148 and $36,646 related to VIEs)
380,332 376,451 
Current liabilities related to assets held for sale536,909 402,483 
Total current liabilities3,624,895 3,572,037 
Long-term debt1,170,544 1,701,098 
Deferred taxes63,709 80,745 
Other noncurrent liabilities ($7,104 and $9,164 related to VIEs)
555,281 593,765 
Noncurrent liabilities related to assets for sale— 98,940 
Contingencies and commitments
Equity
Shareholders’ equity
Preferred stock — authorized 20,000,000 shares ($0.01 par value); issued and outstanding — 600,000 shares in 2021 and none issued in 2020
— 
Common stock — authorized 375,000,000 shares ($0.01 par value); issued and outstanding — 141,411,916 and 140,715,205 shares in 2021 and 2020, respectively
1,411 1,404 
Additional paid-in capital958,526 195,940 
AOCI(441,819)(416,906)
Retained earnings1,079,403 1,249,809 
Total shareholders’ equity1,597,527 1,030,247 
NCI246,127 232,980 
Total equity1,843,654 1,263,227 
Total liabilities and equity$7,258,083 $7,309,812 

The accompanying notes are an integral part of these financial statements.
5

FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
UNAUDITED
9ME
September 30,
(in thousands)20212020
OPERATING CASH FLOW  
Net earnings (loss)$(138,472)$(251,072)
Adjustments to reconcile net earnings (loss) to operating cash flow:
Impairment expense - Cont Ops26,392 102,365 
Impairment expense - Disc Ops126,285 295,239 
Depreciation59,666 76,619 
Amortization of intangibles827 2,673 
(Earnings) loss from equity method investments, net of distributions(7,684)(2,005)
(Gain) loss on sales of assets incl. AMECO-North America9,479 9,952 
Loss on debt repurchases19,606 — 
Stock-based compensation24,989 11,571 
Deferred taxes26,836 (23,673)
Net retirement plan accrual (contributions)(12,237)(8,507)
Changes in assets and liabilities(352,566)(63,904)
Other(2,670)(5,018)
Operating cash flow(219,549)144,240 
INVESTING CASH FLOW
Purchases of marketable securities(73,449)(23,589)
Proceeds from sales and maturities of marketable securities29,702 13,339 
Capital expenditures(54,550)(80,786)
Proceeds from sales of assets incl. AMECO-North America125,374 54,849 
Investments in partnerships and joint ventures(79,847)(25,252)
Other(12,169)4,690 
Investing cash flow(64,939)(56,749)
FINANCING CASH FLOW
Proceeds from issuance of CPS582,000 — 
Purchases and retirement of debt(525,212)— 
Debt extinguishment costs(1,503)— 
Dividends paid (on CPS in 2021 and common stock in 2020)(9,425)(28,720)
Other borrowings (debt repayments)(6,673)13,527 
Distributions paid to NCI(20,158)(19,288)
Capital contributions by NCI201,511 82,109 
Taxes paid on vested restricted stock(4,353)(1,313)
Other 1,903 (356)
Financing cash flow218,090 45,959 
Effect of exchange rate changes on cash(6,868)(36,867)
Increase (decrease) in cash and cash equivalents(73,266)96,583 
Cash and cash equivalents at beginning of period2,198,781 1,997,199 
Cash and cash equivalents at end of period$2,125,515 $2,093,782 

The accompanying notes are an integral part of these financial statements.

6

FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
UNAUDITED
(in thousands, except per share amounts)Preferred StockCommon StockAdditional Paid-In CapitalAOCIRetained
Earnings
Total Shareholders' EquityNCITotal
Equity
SharesAmountSharesAmount
BALANCE AS OF JUNE 30, 2021600 $141,416 $1,411 $882,450 $(416,663)$1,048,345 $1,515,549 $255,845 $1,771,394 
Net earnings (loss)— — — — — — 40,469 40,469 (3,119)37,350 
OCI— — — — — (25,156)— (25,156)2,355 (22,801)
Issuance of CPS— — — — — — — — — — 
Dividends on CPS ($16.25 per share)
— — — — — — (9,425)(9,425)— (9,425)
Distributions to NCI— — — — — — — — (1,981)(1,981)
Capital contributions by NCI— — — — — — — — 95,479 95,479 
Other NCI transactions— — — — 72,414 — — 72,414 (102,452)(30,038)
Stock-based plan activity— — (4)— 3,662 — 14 3,676 — 3,676 
BALANCE AS OF
SEPTEMBER 30, 2021
600 $141,412 $1,411 $958,526 $(441,819)$1,079,403 $1,597,527 $246,127 $1,843,654 

(in thousands, except per share amounts)Preferred StockCommon StockAdditional Paid-In CapitalAOCIRetained
Earnings
Total Shareholders' EquityNCITotal
Equity
SharesAmountSharesAmount
BALANCE AS OF
DECEMBER 31, 2020
— $— 140,715 $1,404 $195,940 $(416,906)$1,249,809 $1,030,247 $232,980 $1,263,227 
Net earnings (loss)— — — — — — (161,001)(161,001)22,529 (138,472)
OCI— — — — — (24,913)— (24,913)1,759 (23,154)
Issuance of CPS600 — — 581,994 — — 582,000 — 582,000 
Dividends on CPS ($16.25 per share)
— — — — — — (9,425)(9,425)— (9,425)
Distributions to NCI— — — — — — — — (20,158)(20,158)
Capital contributions by NCI— — — — — — — — 201,511 201,511 
Other NCI transactions— — — — 159,473 — — 159,473 (192,494)(33,021)
Stock-based plan activity— — 697 21,119 — 20 21,146 — 21,146 
BALANCE AS OF
SEPTEMBER 30, 2021
600 $141,412 $1,411 $958,526 $(441,819)$1,079,403 $1,597,527 $246,127 $1,843,654 

The accompanying notes are an integral part of these financial statements.









7

FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Continued)
UNAUDITED
(in thousands, except per share amounts)Common StockAdditional Paid-In CapitalAOCIRetained
Earnings
Total Shareholders' EquityNCITotal
Equity
SharesAmount
BALANCE AS OF JUNE 30, 2020140,565 $1,403 $175,089 $(478,636)$1,393,866 $1,091,722 $139,172 $1,230,894 
Net earnings (loss)— — — — 19,341 19,341 4,299 23,640 
OCI— — — 15,320 — 15,320 (495)14,825 
Distributions to NCI— — — — — — (8,457)(8,457)
Capital contributions by NCI— — — — — — 42,589 42,589 
Other NCI transactions— — 321 — — 321 630 951 
Stock-based plan activity44 — 2,207 — 35 2,242 — 2,242 
BALANCE AS OF SEPTEMBER 30, 2020140,609 $1,403 $177,617 $(463,316)$1,413,242 $1,128,946 $177,738 $1,306,684 

(in thousands, except per share amounts)Common StockAdditional Paid-In CapitalAOCIRetained
Earnings
Total Shareholders' EquityNCITotal
Equity
SharesAmount
BALANCE AS OF
DECEMBER 31, 2019
140,174 $1,399 $165,314 $(379,873)$1,700,912 $1,487,752 $96,340 $1,584,092 
Net earnings (loss)— — — — (271,608)(271,608)20,536 (251,072)
Cumulative adjustment for the adoption of ASC 326— — — — (1,977)(1,977)— (1,977)
OCI— — — (83,443)— (83,443)(2,291)(85,734)
Dividends ($0.10 per share)
— — — — (14,120)(14,120)— (14,120)
Distributions to NCI— — — — — — (19,288)(19,288)
Capital contributions by NCI— — — — — — 82,109 82,109 
Other NCI transactions— — 2,057 — — 2,057 332 2,389 
Stock-based plan activity435 10,246 — 35 10,285 — 10,285 
BALANCE AS OF SEPTEMBER 30, 2020140,609 $1,403 $177,617 $(463,316)$1,413,242 $1,128,946 $177,738 $1,306,684 

The accompanying notes are an integral part of these financial statements.
8


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED

1. Principles of Consolidation

These financial statements do not include footnotes and certain financial information normally presented annually under GAAP, and therefore, should be read in conjunction with our 2020 10-K. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year-end. Although such estimates are based on management’s most recent assessment of the underlying facts and circumstances utilizing the most current information available, our reported results of operations may not necessarily be indicative of results that we expect for the full year.

The financial statements included herein are unaudited. In management's opinion, they contain all adjustments of a normal recurring nature which are necessary to present fairly our financial position and our operating results as of and for the interim periods presented. All significant intercompany transactions of consolidated subsidiaries are eliminated. Certain amounts in 2020 have been reclassified to conform to the 2021 presentation, which includes the segregation of Disc Ops and assets and liabilities held for sale. Certain amounts in tables may not total or agree to the financial statements due to immaterial rounding differences. Management has evaluated all material events occurring subsequent to September 30, 2021 through the filing date of this Q3 2021 10-Q.
Quarters are typically 13 weeks in length but, due to our annual period ending on December 31, the number of weeks in a reporting period may vary slightly during the year and for comparable prior year periods. We report our quarterly results of operations based on periods ending on the Sunday nearest March 31, June 30 and September 30, allowing for a 13-week quarter. For simplicity of presentation, all periods are presented as if the periods ended on March 31, June 30 and September 30.
In the first quarter of 2021, we committed to a plan to sell our Stork business. This plan and our plan to sell the remaining AMECO equipment business remains unchanged. Therefore, both Stork and AMECO are reported as Disc Ops. We expect to complete the sale of Stork and the remaining AMECO operations near the end of this year or early in 2022. The assets and liabilities of the Stork and AMECO businesses are classified as held for sale for all periods presented.
2. Recent Accounting Pronouncements
Accounting pronouncements that were implemented by us during the 2021 Period

In the first quarter of 2021, we adopted ASU 2020-06, “Accounting for Convertible Instruments and Contracts in an Entity's Own Equity,” which simplifies accounting for convertible instruments and the application of the derivatives scope exception for contracts in our own equity. ASU 2020-06 eliminates two of the three models in the prior guidance that required separating embedded conversion features from convertible instruments and also eliminates some of the requirements for equity classification. ASU 2020-06 also addresses how convertible instruments are accounted for in the diluted EPS calculation. The adoption did not have any impact on our financial statements.
9


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
3. Earnings Per Share
Potentially dilutive securities include CPS, stock options, RSUs, restricted stock and performance-based award units. Diluted EPS reflects the assumed exercise or conversion of all dilutive securities using the if-converted and treasury stock methods. In computing diluted EPS, only securities that are actually dilutive are included.
(in thousands, except per share amounts)3ME
September 30,
9ME
September 30,
2021202020212020
Net earnings (loss) from Cont Ops attributable to Fluor$46,730 $21,518 $(20,911)$28,206 
Less: Dividends on CPS9,750 — 14,625 — 
Net earnings (loss) from Cont Ops available to Fluor common stockholders36,980 21,518 (35,536)28,206 
Net earnings (loss) from Disc Ops attributable to Fluor(6,261)(2,177)(140,090)(299,814)
Net earnings (loss) available to Fluor common stockholders$30,719 $19,341 $(175,626)$(271,608)
Weighted average common shares outstanding141,412 140,598 141,229 140,465 
Diluted effect:
CPS(1)
— — 
Stock options, RSUs, restricted stock and performance-based award units(2)
— 570— 464
Weighted average diluted shares outstanding141,412141,168141,229140,929
Basic EPS available to Fluor common stockholders:
Net earnings (loss) from Cont Ops$0.26 $0.15 $(0.25)$0.20 
Net earnings (loss) from Disc Ops(0.04)(0.01)(0.99)(2.13)
Diluted EPS available to Fluor common stockholders:
Net earnings (loss) from Cont Ops$0.26 $0.15 $(0.25)$0.20 
Net earnings (loss) from Disc Ops(0.04)(0.01)(0.99)(2.13)
Anti-dilutive securities not included in shares outstanding:
(1) CPS26,975 — 13,240 — 
(2) All others1,618 — 1,743 — 
4. Operating Information by Segment and Geographic Area
During the first quarter of 2021, we changed the composition of our segments to implement our new strategy and to pursue opportunities in our designated markets. We now report our operating results as follows: Energy Solutions, Urban Solutions, Mission Solutions and Other. Segment operating information and assets for 2020 have been recast to conform to these changes.
Energy Solutions focuses on energy transition, chemicals, LNG, and traditional oil and gas opportunities. The segment is pursuing new opportunities emerging in the energy transition market including carbon capture, green chemicals, hydrogen, biofuels and other low carbon energy sources. The segment also continues to provide EPC services for the oil, gas and petrochemical industries.
Urban Solutions focuses on mining, metals, advanced technologies, manufacturing, life sciences, infrastructure and professional staffing services.
10


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
Mission Solutions focuses on federal agencies across the U.S. government and select international opportunities. These include, among others, the DOE, the Department of Defense, the Federal Emergency Management Agency and intelligence agencies. Mission Solutions includes the Radford and Warren projects which were previously reported in the Other segment.
Other now includes only the operations of NuScale.
3ME
September 30,
9ME
September 30,
(in millions)2021202020212020
Revenue
Energy Solutions$1,365.4 $1,337.9 $3,675.4 $4,195.2 
Urban Solutions1,014.7 1,329.4 3,419.2 4,434.2 
Mission Solutions723.0 789.6 2,183.4 2,260.2 
Total revenue$3,103.1 $3,456.9 $9,278.0 $10,889.6 
Segment profit (loss)
Energy Solutions$72.5 $96.2 $183.9 $133.0 
Urban Solutions17.8 29.3 (20.8)119.2 
Mission Solutions27.9 24.5 116.5 66.3 
Other(8.2)(21.6)(42.4)(62.9)
Total segment profit (loss)$110.0 $128.4 $237.2 $255.6 
G&A(42.4)(36.7)(139.4)(112.9)
Impairment, restructuring and other exit costs— — (26.4)(106.2)
Foreign currency gain (loss)37.5 (29.8)(4.2)16.2 
Interest income (expense), net(31.4)(11.9)(59.3)(26.9)
Earnings (loss) from Cont Ops attributable to NCI(3.5)4.2 21.5 19.7 
Earnings (loss) from Cont Ops before taxes$70.2 $54.2 $29.4 $45.5 
Intercompany revenue for our professional staffing business, excluded from revenue above$60.4 $60.6 $198.9 $199.7 
The following describes material changes to estimates impacting segment results:
Energy Solutions. Segment profit for the 2021 Period included forecast revisions resulting from the negotiation of change orders, scope increases and cost improvements across numerous projects.
Urban Solutions. Segment profit for the 2021 Quarter and 2021 Period included forecast revisions for schedule delays and productivity on a light rail project. Segment profit for the 2021 Period also included forecast revisions for procurement and subcontractor cost growth, delays and disruptions in schedule of a legacy infrastructure project, resulting in a charge of $138 million (or $0.72 per share). We believe that these cost growth factors may be at least partially recoverable under the contract. However, we expect that it will require several quarters to analyze recoverability and negotiate with our client before recognizing incremental revenue for these factors.
Mission Solutions. Segment profit for the 2021 Period included forecast revisions for higher than anticipated performance-based fees and the release of COVID cost reserves.
Other. During the 2021 Period, NuScale received $193 million in capital contributions from outside investors. As of September 30, 2021, Fluor had an approximate 80% ownership in NuScale. Fluor and its advisors continue to engage with potential investors and capital providers to fund NuScale's path to commercialization.


11


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
NuScale expenses included in the determination of segment loss were as follows:
3ME
September 30,
9ME
September 30,
(in millions)2021202020212020
NuScale expenses$(42.9)$(43.3)$(122.6)$(119.2)
Less: DOE reimbursable expenses 18.1 20.4 49.9 53.8 
NuScale expenses, net(24.8)(22.9)(72.7)(65.4)
Less: Attributable to NCI 16.6 1.3 30.3 2.5 
Fluor segment loss$(8.2)$(21.6)$(42.4)$(62.9)
Total assets by segment are as follows:
(in millions)September 30,
2021
December 31,
2020
Energy Solutions$1,196.2 $1,010.9 
Urban Solutions1,110.4 1,122.5 
Mission Solutions629.0 575.8 
Other38.5 37.8 
Revenue by project location follows:
3ME
September 30,
9ME
September 30,
(in millions)2021202020212020
North America$2,023.6 $2,320.6 $6,058.9 $7,079.8 
Asia Pacific (includes Australia)255.3 329.5 1,001.4 980.9 
Europe417.7 491.3 1,052.3 1,594.4 
Central and South America337.4 190.9 904.8 823.7 
Middle East and Africa69.1 124.6 260.6 410.8 
Total revenue$3,103.1 $3,456.9 $9,278.0 $10,889.6 
5. Impairment, Restructuring and Other Exit Costs
Impairment
We did not recognize any impairment expense in Cont Ops during the 2021 and 2020 Quarters. Impairment expense, included in Cont Ops, for the 2021 and 2020 Periods is summarized as follows:
9ME
September 30,
(in thousands)20212020
Impairment expense:
Energy Solutions' equity method investment$26,392 $86,096 
Information technology assets— 16,269 
Total impairment expense$26,392 $102,365 
Our business has been adversely affected by the economic impacts of the outbreak of COVID and the steep decline in oil prices that occurred in the early part of 2020. These events have created significant uncertainty and economic volatility and disruption, which have impacted and may continue to impact our business. We have experienced, and may continue to experience, reductions in demand for certain of our services and the delay or abandonment of ongoing or anticipated projects due to our clients’, suppliers’ and other third parties’ diminished financial condition or financial distress, as well as
12


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
governmental budget constraints. These impacts may continue or worsen under prolonged stay-at-home, social distancing, travel restrictions and other similar orders or restrictions. Significant uncertainty still exists concerning the magnitude of the impact and duration of these events. Because of these events, we performed interim impairment testing of our goodwill, intangible assets and investments during the 2020 Period, pursuant to which we recognized the impairment expense on an equity method investment and IT assets. We also recognized impairment expense on goodwill and intangible assets associated with the Stork business, now included in Disc Ops.
The valuation of our equity method investments utilized unobservable Level 3 inputs based on the investee's forecast of anticipated volumes and overhead absorption in a cyclical business.
Restructuring and Other Exit Costs
During 2019, we initiated a restructuring plan designed to optimize costs and improve operational efficiency. These efforts primarily relate to the rationalization of resources, investments, real estate and overhead across various geographies. Our recognition of costs for the planned restructuring activities was substantially completed by the end of 2020. Restructuring costs of $4 million, primarily related to severance, were recognized during both the 2020 Quarter and 2020 Period. We did not recognize any material restructuring costs during 2021.
A reconciliation of our restructuring liabilities follows:
(in thousands)SeveranceLease Exit CostsTotal
Balance as of December 31, 2019$30,479 $564 $31,043 
Restructuring charges accrued during the period3,720 334 4,054 
Cash payments / settlements during the period(18,858)(793)(19,651)
Currency translation1,140 1,141 
Balance as of December 31, 2020$16,481 $106 $16,587 
Cash payments / settlements during the period$(16,378)$(106)$(16,484)
Currency translation(103)— (103)
Balance as of September 30, 2021$— $— $— 
6. Income Taxes

The effective tax rate on earnings (loss) from Cont Ops was 38.4% for the 2021 Quarter and 97.8% for the 2021 Period compared to 52.6% and (5.3)% for the corresponding periods of 2020. For all periods, the effective tax rate was unfavorably impacted by increases in the valuation allowances against foreign tax credit carryforwards and certain foreign net operating loss carryforwards. The 2021 Period unfavorable impact was partially offset by favorable foreign tax rate differentials. The effective tax rate in the 2020 Period was favorably impacted by the release of valuation allowances and rate benefits resulting from the carryback of our 2019 federal net operating loss as allowed by the CARES Act. Earnings attributable to non-controlling interests from continuing operations, for which income taxes are not typically our responsibility, favorably impacted the effective tax rate for the 2021 Period.
7. Cash Paid for Interest and Taxes
9ME
September 30,
(in thousands)20212020
Cash paid for:
Interest$80,796 $54,677 
Income taxes (net of refunds)59,246 29,367 

13


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
8. Partnerships and Joint Ventures

In the normal course of business, we form partnerships or joint ventures primarily for the execution of single contracts or projects. The majority of these partnerships or joint ventures are characterized by a 50 percent or less noncontrolling ownership or participation interest with decision making and distribution of expected gains and losses typically being proportionate to the ownership or participation interest. Many of the partnership and joint venture agreements provide for capital calls to fund operations, as necessary. Accounts receivable related to work performed for unconsolidated partnerships and joint ventures included in “Accounts receivable, net” was $216 million and $207 million as of September 30, 2021 and December 31, 2020, respectively.

One of our more significant joint ventures is COOEC Fluor, in which we have a 49% ownership interest. COOEC Fluor owns, operates and manages the Zhuhai Fabrication Yard in China’s Guangdong province. We made a capital contribution of $26 million to the joint venture during the first quarter of 2021, which satisfied our contractual funding requirements.
During the 2021 Period, we sold our 10% ownership interest in an infrastructure joint venture and recognized a gain of $20 million, which was included in Urban Solutions' segment profit. During the 2020 Period, we sold our 50% ownership interest in Sacyr Fluor and recognized a loss of $11 million, which was included in Energy Solutions' segment profit.
Variable Interest Entities

The aggregate carrying value of unconsolidated VIEs (classified under both "Investments” and “Other accrued liabilities”) was a net asset of $82 million and $174 million as of September 30, 2021 and December 31, 2020, respectively. Some of our VIEs have debt; however, such debt is typically non-recourse in nature. Our maximum exposure to loss as a result of our investments in unconsolidated VIEs is typically limited to the aggregate of the carrying value of the investment and future funding necessary to satisfy the contractual obligations of the VIE. Future funding commitments as of September 30, 2021 for the unconsolidated VIEs were $57 million.
In some cases, we are required to consolidate certain VIEs. Assets and liabilities associated with the operations of our consolidated VIEs are presented on the balance sheet. The assets of a VIE are restricted for use only for the particular VIE and are not available for our general operations.
We have agreements with certain VIEs to provide financial or performance assurances to clients, as discussed elsewhere.
9. Guarantees
In the ordinary course of business, we enter into various agreements providing performance assurances and guarantees to our clients on behalf of certain unconsolidated and consolidated partnerships, joint ventures and other jointly executed contracts. These agreements are entered into primarily to support project execution commitments. Performance guarantees have various expiration dates ranging from mechanical completion to a period extending beyond contract completion. The maximum potential amount of future payments that we could be required to make under outstanding performance guarantees, which represents the remaining cost of work to be performed, was estimated to be $13 billion as of September 30, 2021. For cost reimbursable contracts, amounts that may become payable pursuant to guarantee provisions are normally recoverable from the client for work performed. For lump-sum contracts, the performance guarantee amount is the cost to complete the contracted work, less amounts remaining to be billed to the client under the contract. Remaining billable amounts could be greater or less than the cost to complete. In those cases where costs exceed the remaining amounts payable under the contract, we may have recourse to third parties, such as owners, partners, subcontractors or vendors for claims. There were no liabilities related to performance guarantees as of September 30, 2021 and December 31, 2020.
10. Contingencies and Commitments

We and certain of our subsidiaries are subject to litigation, claims and other commitments and contingencies arising in the ordinary course of business. Although the asserted value of these matters may be significant, we currently do not expect that the ultimate resolution of any open matters will have a material adverse effect on our financial position or results of operations.
14


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
The following disclosures for commitments and contingencies have been updated since the matter was presented in the 2020 10-K.

Since May 2018, purported shareholders have filed various complaints against Fluor and certain of its current and former executives in the U.S. District Court for the Northern District of Texas. The plaintiffs purport to represent a class of shareholders who purchased or otherwise acquired Fluor common stock from August 14, 2013 through February 14, 2020, and seek to recover damages arising from alleged violations of federal securities laws. These claims are based on statements concerning Fluor’s internal and disclosure controls, risk management, revenue recognition, and Fluor’s gas-fired power contracts, which plaintiffs assert were materially misleading. As of May 26, 2020, these complaints have been consolidated into one matter. We filed a motion to dismiss the matter on July 1, 2020. The motion was granted in part on May 5, 2021, and as a result the Court dismissed with prejudice all allegations except those related to a single statement made in 2015 about one gas-fired power contract. While no assurance can be given as to the ultimate outcome of this matter, we do not believe it is probable that a loss will be incurred. Accordingly, we have not recorded any liability as a result of this action.

Since September 2018, ten separate purported shareholders' derivative actions were filed against current and former members of the Board of Directors, as well as certain of Fluor’s current and former executives. Fluor is named as a nominal defendant in the actions. These derivative actions purport to assert claims on behalf of Fluor and make substantially the same factual allegations as the securities class action matter discussed above and seek various forms of monetary and injunctive relief. These actions are pending in Texas state court (District Court for Dallas County), the U.S. District Court for the District of Delaware, the U.S. District Court for the Northern District of Texas, and the Court of Chancery of the State of Delaware. Certain of these actions were consolidated and stayed, at least while our motion to dismiss was pending in the securities class action matter. We anticipate seeking a further stay until final resolution of the securities class action. While no assurance can be given as to the ultimate outcome of this matter, we do not believe it is probable that a loss will be incurred. Accordingly, we have not recorded any liability as a result of these actions.
There have been no substantive changes to the disclosures for the following commitments and contingencies since the matter was presented in the 2020 10-K.

Fluor Australia Ltd., our wholly-owned subsidiary (“Fluor Australia”), completed a cost reimbursable engineering, procurement and construction management services project for Santos Ltd. (“Santos”) involving a large network of natural gas gathering and processing facilities in Queensland, Australia. On December 13, 2016, Santos filed an action in Queensland Supreme Court against Fluor Australia, asserting various causes of action and seeking damages and/or a refund of contract proceeds paid of approximately AUD $1.47 billion. Santos has joined Fluor to the matter on the basis of a parent company guarantee issued for the project. We believe that the claims asserted by Santos are without merit and we are vigorously defending these claims. While no assurance can be given as to the ultimate outcome of this matter, we do not believe it is probable that a loss will be incurred. Accordingly, we have not recorded any liability as a result of this action.

Fluor Limited, our wholly-owned subsidiary (“Fluor Limited”), and Fluor Arabia Limited, a partially-owned subsidiary
(“Fluor Arabia”), completed cost reimbursable engineering, procurement and construction management services for Sadara Chemical Company (“Sadara”) involving a large petrochemical facility in Jubail, Kingdom of Saudi Arabia. On August 23, 2019, Fluor Limited and Fluor Arabia Limited commenced arbitration proceedings against Sadara after it refused to pay invoices totaling approximately $100 million due under the contracts. As part of the arbitration proceedings, Sadara has asserted various counterclaims for damages and/or a refund of contract proceeds paid totaling approximately $574 million against Fluor Limited and Fluor Arabia Limited. We believe that the counterclaims asserted by Sadara are without merit and are vigorously defending these claims. While no assurance can be given as to the ultimate outcome of the counterclaims, we do not believe it is probable that a loss will be incurred in excess of amounts reserved for this matter. Accordingly, we have not recorded any further liability as a result of the counterclaims.
Various wholly-owned subsidiaries of Fluor, in conjunction with a partner, TECHINT, (“Fluor/TECHINT”) performed engineering, procurement and construction management services on a cost reimbursable basis for Barrick Gold Corporation involving a gold mine and ore processing facility on a site straddling the border between Argentina and Chile. In 2013 Barrick terminated the Fluor/TECHINT agreements for convenience and not due to the performance of Fluor/TECHINT. On August 12, 2016, Barrick filed a notice of arbitration against Fluor/TECHINT, demanding damages and/or a refund of contract proceeds paid of not less than $250 million under various claims relating to Fluor/TECHINT’s alleged performance. Proceedings were
15


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
suspended while the parties explored a possible settlement. In August 2019, Barrick drew down $36 million of letters of credit from Fluor/TECHINT ($24 million from Fluor and $12 million from TECHINT). Thereafter, Barrick proceeded to reactivate the arbitration. Barrick and Fluor/TECHINT have exchanged detailed statements of claim and counterclaim pursuant to which Barrick's claim against Fluor/TECHINT now totals approximately $364 million. We believe that the claims asserted by Barrick are without merit and are vigorously defending these claims. While no assurance can be given as to the ultimate outcome of this matter, we do not believe it is probable that a loss will be incurred. Accordingly, we have not recorded any liability as a result of these claims.
Other Matters

We periodically evaluate our positions and the amounts recognized with respect to all our claims and back charges. As of September 30, 2021 and December 31, 2020, we had recorded $211 million and $216 million, respectively, of claim revenue for costs incurred to date. Additional costs, which will increase the claim revenue balance over time, are expected to be incurred in future periods. We had no material disputed back charges to suppliers or subcontractors as of September 30, 2021 and December 31, 2020.

From time to time, we enter into contracts with the U.S. government and its agencies. Government contracts are subject to audits and reviews by government representatives with respect to our compliance with various restrictions and regulations applicable to government contractors, including but not limited to the allowability of costs incurred under reimbursable contracts. In connection with performing government contracts, we maintain reserves for estimated exposures associated with these matters.

Our operations are subject to and affected by federal, state and local laws and regulations regarding the protection of the environment. We maintain reserves for potential future environmental cost where such obligations are either known or considered probable, and can be reasonably estimated. We believe that our reserves with respect to future environmental cost are adequate and such future cost will not have a material effect on our financial position or results of operations.
In February 2020, we announced that the SEC is conducting an investigation and has requested documents and information related to projects for which we recorded charges in the second quarter of 2019. In April 2020, Fluor received a subpoena from the U.S. Department of Justice (“DOJ”) seeking documents and information related to the second quarter 2019 charges; certain of the projects associated with those charges; and certain project accounting, financial reporting and governance matters. Such inquiries are ongoing, and we have continued to respond to the SEC and DOJ and cooperate in these investigations.
16


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
11. Contract Assets and Liabilities

The following summarizes information about our contract assets and liabilities:
(in millions)September 30, 2021December 31, 2020
Information about contract assets:
Contract assets
Unbilled receivables - reimbursable contracts$724 $590 
Contract work in progress - lump-sum contracts288 270 
Contract assets$1,012 $860 
Advance billings deducted from contract assets$234 $308 
9ME
September 30,
(in millions)20212020
Information about contract liabilities:
Revenue recognized that was included in contract liabilities as of January 1$836 $674 
12. Remaining Unsatisfied Performance Obligations

We estimate that our RUPO will be satisfied over the following periods:
(in millions)September 30, 2021
Within 1 year$11,039 
1 to 2 years5,610 
Thereafter3,892 
Total RUPO$20,541 
During the 2021 Period, we removed approximately $2 billion from RUPO due to the cancellation of a chemicals project and a steel project in North America.
17


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
13. Debt and Letters of Credit

Debt consisted of the following:
(in thousands)September 30, 2021December 31, 2020
Borrowings under credit facility$— $— 
Current:
Other borrowings$4,639 $4,890 
Long-term:
Senior Notes
2023 Notes$196,589 $611,250 
Unamortized discount on 2023 Notes(61)(283)
Unamortized deferred financing costs(257)(1,203)
2024 Notes381,014 500,000 
Unamortized discount on 2024 Notes(1,316)(2,130)
Unamortized deferred financing costs(1,032)(1,670)
2028 Notes600,000 600,000 
Unamortized discount on 2028 Notes(886)(981)
Unamortized deferred financing costs(3,507)(3,885)
Total long-term$1,170,544 $1,701,098 

Credit Facility

As of September 30, 2021, letters of credit totaling $399 million were outstanding under our $1.65 billion credit facility, which matures in February 2023. The credit facility contains customary financial covenants, including a debt-to-capitalization ratio that cannot exceed 0.65 to 1.0, a limitation on the aggregate amount of debt of the greater of $750 million or €750 million for our subsidiaries, and a minimum liquidity threshold of $1.25 billion, defined in the amended credit facility. The credit facility also contains provisions that will require us to provide collateral to secure the facility should we be downgraded to BB by S&P and Ba2 by Moody's, such collateral consisting broadly of our U.S. assets. Borrowings under the facility, which may be denominated in USD, EUR, GBP or CAD, bear interest at a base rate, plus an applicable borrowing margin. As of September 30, 2021, we could have borrowed an additional $795 million under our existing credit facility.
Uncommitted Lines of Credit
As of September 30, 2021, letters of credit totaling $900 million were outstanding under uncommitted lines of credit, although no amounts were drawn.
Senior Notes
In September 2021, we completed a tender offer in which we repurchased $375 million of 2023 Notes and $108 million of 2024 Notes, excluding accrued interest. Additionally, we redeemed $26 million of outstanding 2023 and 2024 Notes in open market transactions during the 2021 Period. We used the proceeds from the issuance of preferred stock to redeem the 2023 and 2024 Notes. We recognized $20 million in losses related to these redemptions which is included in interest expense.
14. Preferred Stock

In May 2021, we issued 600,000 shares of Series A 6.5% cumulative perpetual CPS in a private placement transaction involving a limited number of qualified institutional buyers.

The preferred stock, with respect to dividend rights or rights upon liquidation, winding-up or dissolution of Fluor, ranks senior to all classes of common stock and to any other class of capital stock or series of preferred stock that may be established (except in certain circumstances). The CPS is, however, junior to our existing and future indebtedness.

18


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
The preferred stock does not have a maturity date. Cumulative cash dividends on the preferred stock are payable at an annual rate of 6.5% quarterly in arrears on February 15, May 15, August 15 and November 15, beginning on August 15, 2021, upon declaration of the dividend by our Board of Directors. Dividends accumulate from the most recent date on which dividends have been paid. CPS dividends of $9 million were paid in August 2021. In October 2021, our Board of Directors approved the payment of a preferred stock dividend of $10 million.

Each share of preferred stock has a liquidation preference of $1,000 per share, plus accumulated but unpaid dividends, and is convertible, at the holder's option at any time into 44.9585 shares of our common stock per share of preferred stock. The conversion rate is subject to certain customary adjustments, but no payment or adjustment for accumulated but unpaid dividends will be made upon conversion, subject to certain limited exceptions. The preferred stock may not be redeemed by us; however, we may, at any time on or after May 20, 2022, elect to cause all outstanding shares of preferred stock to be automatically converted into shares of our common stock at the conversion rate, subject to certain conditions (and, if such automatic conversion occurs prior to May 20, 2024, the payment of a cash make-whole premium). If a “make-whole fundamental change” occurs, we will in certain circumstances be required to increase the conversion rate for a holder who elects to convert shares of preferred stock in connection with such make-whole fundamental change.

The shares of preferred stock have no voting rights except if and when dividends on the preferred stock are in arrears and have been unpaid with respect to six or more quarterly dividend payment dates (whether or not consecutive). In such events, the holders of the preferred stock would be entitled to elect two additional directors to the board of directors. Such voting rights are exercisable until all dividends in arrears have been paid in full, at which time the voting rights and the term of the two additional directors terminate.

Concurrent with the issuance of the CPS, 200,000 shares of preferred stock previously designated as Series A Junior Participating Preferred Stock were eliminated and returned to the status of authorized but unissued shares of preferred stock, without designation.
15. Fair Value Measurements
The following table delineates assets and liabilities that are measured at fair value on a recurring basis:
 September 30, 2021December 31, 2020
 Fair Value HierarchyFair Value Hierarchy
(in thousands)TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3
Assets:        
Deferred compensation trusts(1)
$15,844 $15,844 $— $— $9,626 $9,626 $— $— 
Derivative assets(2)
Foreign currency20,977 — 20,977 — 22,667 — 22,667 — 
Commodity5,927 — 5,927 — 806 — 806 — 
Liabilities:
Derivative liabilities(2)
Foreign currency$5,781 $— $5,781 $— $2,571 $— $2,571 $— 
Commodity233 — 233 — 5,059 — 5,059 — 
_________________________________________________________
(1)    Consists of registered money market funds and an equity index fund. These investments, which are trading securities, represent the net asset value at the close of business of the period based on the last trade or official close of an active market or exchange.
(2)    Foreign currency and commodity derivatives are estimated using pricing models with market-based inputs, which take into account the present value of estimated future cash flows.
We have measured assets and liabilities held for sale and certain other impaired assets at fair value on a nonrecurring basis.
19


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
The following summarizes information about financial instruments that are not required to be measured at fair value :
  September 30, 2021December 31, 2020
(in thousands)Fair Value
Hierarchy
Carrying
Value
Fair
Value
Carrying
Value
Fair
Value
Assets:     
Cash(1)
Level 1$1,320,302 $1,320,302 $1,180,024 $1,180,024 
Cash equivalents(2)
Level 2805,213 805,213 1,018,757 1,018,757 
Marketable securities(2)
Level 267,164 67,164 23,345 23,345 
Notes receivable, including noncurrent portion(3)
Level 310,490 10,490 28,488 28,488 
Liabilities: 
2023 Senior Notes(4)
Level 2$196,271 $201,126 $609,764 $578,554 
2024 Senior Notes(4)
Level 2378,666 400,011 496,200 494,045 
2028 Senior Notes(4)
Level 2595,607 619,932 595,134 599,220 
Other borrowings(5)
Level 24,639 4,639 4,890 4,890 
_________________________________________________________
(1)    Cash consists of bank deposits. Carrying amounts approximate fair value.
(2)    The carrying amounts of these time deposits approximate fair value because of the short-term maturity of these instruments. Amortized cost is not materially different from the fair value.
(3)    Notes receivable are carried at net realizable value which approximates fair value. Factors considered in determining the fair value include the credit worthiness of the borrower, current interest rates, the term of the note and any collateral pledged as security. Notes receivable are periodically assessed for impairment.
(4)     The fair value of the Senior Notes was estimated based on the quoted market prices and Level 2 inputs.
(5)    Other borrowings represent bank loans and other financing arrangements which mature within one year. The carrying amount of borrowings under these arrangements approximates fair value because of the short-term maturity.
16. Stock-Based Compensation
Our executive and director stock-based compensation plans are described more fully in the 2020 10-K. In the 2021 and 2020 Periods, RSUs totaling 596,391 and 1,098,926 were granted to executives and directors at a weighted-average grant date fair value of $18.67 per share and $8.81 per share, respectively.
Stock options for the purchase of 481,626 shares at a weighted-average exercise price of $17.96 per share and 672,309 shares at a weighted-average exercise price of $8.81 were awarded to executives during the 2021 and 2020 Periods, respectively.
Performance-based award units totaling 613,868 and 1,156,365 were awarded to executive officers during the 2021 and 2020 Periods. These awards generally vest after a period of 3 years and contain annual performance conditions for each of the 3 years of the vesting period. Under GAAP, performance-based awards are not deemed granted until the performance targets have been established. The performance targets for each year are generally established in the first quarter. Accordingly, only one-third of the units awarded in any given year are deemed to be granted each year of the 3 year vesting periods. During 2021, the following units were granted for GAAP purposes:
Performance-based Award Units Granted in 2021Weighted Average
Grant Date
Fair Value
Per Share
2021 Performance Award Plan204,623$20.49
2020 Performance Award Plan385,455$19.98
2019 Performance Award Plan116,844$20.18
20


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
17. Retirement Plans
Net periodic pension expense for our DB plans includes the following components:
3ME
September 30,
9ME
September 30,
(in thousands)Location of Component2021202020212020
Service costCost of revenue$4,293 $4,442 $13,084 $12,843 
Interest costCorp G&A1,737 2,367 5,294 6,843 
Expected return on assetsCorp G&A(7,081)(6,667)(21,568)(19,260)
Amortization of prior service creditCorp G&A(213)(231)(649)(667)
Recognized net actuarial lossCorp G&A1,406 1,204 4,282 3,476 
Net periodic pension expense$142 $1,115 $443 $3,235 
We currently expect to contribute up to $16 million into our DB plans during 2021, which we expect to be in excess of the minimum funding required. During the 2021 Period, we made contributions of approximately $13 million.
In addition to our DB plans, we participate in multiemployer pension plans for unionized construction and maintenance craft employees. Company contributions, based on the hours worked by employees covered under various collective bargaining agreements, are recognized as net periodic pension expense. Upon withdrawal from a multiemployer plan, we may have an obligation to make additional contributions for our share of any unfunded benefit obligation, but only if we do not meet the requirements of any applicable exemptions. For one of our discontinued operations, we participate in one multiemployer plan in which we are aware of a significant unfunded benefit obligation. However, we believe we qualify for an exemption and do not believe we have a probable payment to the plan. Therefore, we have not recognized a liability related to this unfunded benefit obligation.

18. Derivatives and Hedging
Derivatives Designated as Hedges
As of September 30, 2021, we had total gross notional amounts of $473 million of foreign currency contracts outstanding (primarily related to the Canadian Dollar, Chinese Yuan, British Pound, Euro, Indian Rupee and Philippine Peso) that were designated as hedges. These foreign currency contracts are of varying duration, none of which extend beyond December 2024. There were no commodity contracts outstanding that were designated as hedges as of September 30, 2021.
The fair values of derivatives designated as hedging instruments follows:
 Asset DerivativesLiability Derivatives
(in thousands)Balance Sheet
Location
September 30,
2021
December 31,
2020
Balance Sheet
Location
September 30,
2021
December 31,
2020
Foreign currency contractsOther current assets$14,831 $20,004 Other accrued liabilities$357 $
Foreign currency contractsOther assets2,132 2,184 Noncurrent liabilities93 25 
Total $16,963 $22,188  $450 $29 
21


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
The after-tax amount of gain (loss) recognized in OCI associated with derivative instruments designated as cash flow hedges follows:
3ME
September 30,
9ME
September 30,
Cash Flow Hedges (in thousands)2021202020212020
Foreign currency contracts1,530 10,112 7,716 6,115 
Commodity contracts— — — (108)
1,530 10,112 7,716 6,007 
The after-tax amount of gain (loss) reclassified from AOCI into earnings associated with derivative instruments designated as cash flow hedges follows:
  3ME
September 30,
9ME
September 30,
Cash Flow Hedges (in thousands)Location of Gain (Loss)2021202020212020
Foreign currency contractsCost of revenue$3,084 $943 $12,585 $1,482 
Commodity contractsCost of revenue— — — (100)
Interest rate contractsInterest expense725 (419)(114)(1,258)
Total $3,809 $524 $12,471 $124 
Derivatives Not Designated as Hedges
As of September 30, 2021, we also had total gross notional amounts of $238 million of foreign currency contracts and $25 million of commodity contracts outstanding that were not designated as hedges. The foreign currency contracts primarily related to contract obligations denominated in nonfunctional currencies. The fair value of derivatives not designated as hedges, as well as the associated gains and losses were not material for any period presented.
19. Other Comprehensive Income (Loss)
The components of OCI follow:
3ME
September 30, 2021
3ME
September 30, 2020
(in thousands)Before-Tax
Amount
Tax
Benefit
(Expense)
Net-of-Tax
Amount
Before-Tax
Amount
Tax
Benefit
(Expense)
Net-of-Tax
Amount
OCI:      
Foreign currency translation adjustments$(18,712)$— $(18,712)$4,201 $— $4,201 
Ownership share of equity method investees’ OCI(936)(2,037)(2,973)(1,287)1,253 (34)
DB plan adjustments1,172 (9)1,163 1,070 — 1,070 
Unrealized gain (loss) on hedges(1,814)(465)(2,279)11,328 (1,740)9,588 
Total OCI(20,290)(2,511)(22,801)15,312 (487)14,825 
Less: OCI attributable to NCI2,355 — 2,355 (495)— (495)
OCI attributable to Fluor$(22,645)$(2,511)$(25,156)$15,807 $(487)$15,320 

22


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
9ME
September 30, 2021
9ME
September 30, 2020
(in thousands)Before-Tax
Amount
Tax
Benefit
(Expense)
Net-of-Tax
Amount
Before-Tax
Amount
Tax
Benefit
(Expense)
Net-of-Tax
Amount
OCI:
Foreign currency translation adjustments$(17,281)$(11)$(17,292)$(75,828)$— $(75,828)
Ownership share of equity method investees’ OCI(4,222)(890)(5,112)(18,707)(153)(18,860)
DB plan adjustments3,573 432 4,005 3,071 — 3,071 
Unrealized gain (loss) on hedges(4,457)(298)(4,755)6,751 (868)5,883 
Total OCI(22,387)(767)(23,154)(84,713)(1,021)(85,734)
Less: OCI attributable to NCI1,759 — 1,759 (2,291)— (2,291)
OCI attributable to Fluor$(24,146)$(767)$(24,913)$(82,422)$(1,021)$(83,443)

The changes in AOCI balances follow:
(in thousands)Foreign
Currency
Translation
Ownership
Share of
Equity Method
Investees’ OCI
DB PlansUnrealized
Gain (Loss)
on Hedges
AOCI, Net
Attributable to Fluor:     
Balance as of June 30, 2021$(258,944)$(56,123)$(115,747)$14,151 $(416,663)
OCI before reclassifications(21,067)(3,117)(1)1,530 (22,655)
Amounts reclassified from AOCI— 144 1,164 (3,809)(2,501)
Net OCI(21,067)(2,973)1,163 (2,279)(25,156)
Balance as of September 30, 2021$(280,011)$(59,096)$(114,584)$11,872 $(441,819)
Attributable to NCI:
Balance as of June 30, 2021$(4,764)$— $— $— $(4,764)
OCI before reclassifications2,355 — — — 2,355 
Amounts reclassified from AOCI— — — — — 
Net OCI2,355 — — — 2,355 
Balance as of September 30, 2021$(2,409)$— $— $— $(2,409)
23


FLUOR CORPORATION
NOTES TO FINANCIAL STATEMENTS
UNAUDITED
(in thousands)Foreign
Currency
Translation
Ownership
Share of
Equity Method
Investees’ OCI
DB PlansUnrealized
Gain (Loss)
on Hedges
AOCI, Net
Attributable to Fluor:     
Balance as of December 31, 2020$(260,960)$(53,984)$(118,589)$16,627 $(416,906)
OCI before reclassifications(19,051)(5,540)(1)7,716 (16,876)
Amounts reclassified from AOCI— 428 4,006 (12,471)(8,037)
Net OCI(19,051)(5,112)4,005 (4,755)(24,913)
Balance as of September 30, 2021$(280,011)$(59,096)$(114,584)$11,872 $(441,819)
Attributable to NCI:
Balance as of December 31, 2020$(4,168)$— $— $— $(4,168)
OCI before reclassifications1,759 — — — 1,759 
Amounts reclassified from AOCI— — — — — 
Net OCI1,759 — — — 1,759 
Balance as of September 30, 2021$(2,409)$— $— $— $(2,409)
(in thousands)Foreign
Currency
Translation
Ownership
Share of
Equity Method
Investees’ OCI
DB PlansUnrealized
Gain (Loss)
on Hedges
AOCI, Net
Attributable to Fluor:     
Balance as of June 30, 2020$(321,183)$(54,282)$(97,196)$