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SINCE 1 8 9 0 )49

to the Employees and Shareholders of

THE FLUOR CORPORATION,, LTD. ENGINEERS MANUFACTURERS CONSTRUCTORS 2500 S. ATLANTIC BLVD., LOS ANGELES 22

Metal Product Fabrication, Mfg. Division, Paola, Kansas Mid-Continent Gas-Gasoline Department, Houston, Texas

eX14 awei2emke e#,Ceit he ae QintAaleAWAI Los AngelesSan FranciscoNew York Chicago Boston Pittsburgh Tulsa Houston

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16169/aft e AIal/ Yki4iT ,Ofteeui fitWeritada ,./(ereeo Head Wrightson Processes Ltd. The Fluor Corporation Servicios Indust ria les of Canada, Ltd. De Mexico, S. A.

Message to Employees and Shareholders 4. and 5 , 1949 Income and Expenditures 6 and 7 10 Years' Income and Expenditures 8 and 9 Manufactured Products 10 and I 1 "Xe Kezdez notylawyi Wertiff#& eraihrowieft4 Engineering and Construction 12 and I 3 MECHANICAL DESIGN AND CONSTRUCTION OF THIS COMPLETE REFINERY Research J 4 and 15 WAS COMPLETED BY FLUOR IN 1949 Sales 16 and 17 Ownership of Fluor 18 Employee Benefits 19 Balance Sheet 20 and 21 Board of Directors and Honor Roll 22 and 23 e u,,dyiy,/aa,

The year 1949 was another outstanding year in the Arrangements have been concluded with the Amen- in the interpretation of company personnel policy, resulting history of The Fluor Corporation, Ltd. The volume of work can Smelting and Refining Company whereby we will handle in a more equitable treatment of all employee problems. processed totaled $33,564,876. This is the largest volume the sales, engineering and construction of theASARCOProcess Although business activity in general isstillre- year in the history of our company, being approximately for the recovery of sulfur dioxide. We anticipate a consider- . ceding, it is believed that Fluor's volume of work for 1950 $400,000 greater than the corresponding volume for 1948. able volume of business from this source in the future. will be satisfactory. The new processes mentioned should The net profit realized after taxes was $1,077,457. This 1949 saw major revisions in our organizational help to compensate for anticipated reduction in volume from figure is somewhat less than the corresponding figure for structure. All departments relating to the manufacture of other sources. We are entering 1950 with confidence. 1948, the reduction being due primarily to the very keen Fluor products were grouped to form the Manufacturing competitive situation existing throughout the year. Division and all departments relating to Engineering and By order of the Board of Directors, Dividends were paid amounting to $6.00 per share Construction were streamlined into a single Engineering and on all shares of outstanding common stock. This conserva- Construction Division. Further revision in our organizational tive dividend policy has resulted in the company's maintain- structure included the formation of an Industrial Relations ing a sound financial condition. We are happy to report that Department, adding immeasurably to better understanding the share of profits paid into the two employee Trust Funds, between employer and employees. This department assists President before deductions for taxes, amounted to $434,573. During the year, the range and scope of our activities increased considerably. Arrangements were completed with Head Wrightson Processes Ltd., London, England, whereby we were placed in a satisfactory position to undertake engineering construction projects, and also for the manufacture of our products within the sterling area. Our agreements were ratified by the British Treasury on Sep- tember 26; these provide for the converting of profits realized into U. S. dollars. Orders for manufactured products have 2OW0a/thl9 ,jio&ea4 gttit Me/M/Lafteta 6tti9tWe e/Paikid been received in this territory and are now being processed.

A number of quotations are outstanding and we anticipate MILLIONS

receiving a substantial volume of business in this territory 30 during 1950 and in future years. TREND OF 15 The company has entered into agreements with the FLUOR'S ANNUAL Mathieson Chemical Corporation, one of the nation's largest 20 chemical firms, whereby we will undertake the sales, en- GROSS BILLING 15 gineering and construction of theirSASCOProcess for the recovery of elemental sulfur from hydrogen sulfide gas. This 10 agreement also includes a similar arrangement for the recov- NATION'S ery of elemental sulfur from refinery acid sludge. A sub- ENGINEERING CONSTRUCTION 5 stantial amount of engineering and construction should re- TREND* D. W. DARNELL sult from these processes in the years ahead. 1948 1949 .Copyright, Engineering News-Record, 1949 1940 1941 1942 1943 1944 1945 1946 1947

Page Four Page Five cVeamdiwy, eokiw ew,1949

1949

7;en0azezikoe ieceiredidom.. $

Sales: ConstructionBilling revenues $24,677,993 I Manufactured products (less discounts) 8,781,764 PURCHASES * * Royalties, discounts and other 105,119 56.71% Total sales and revenues $33,564,876 100.00 TAXES 2.39% 9tX/f/XMAW ff,Jealfr.'

Wages and salaries $11,701,381 34.86 Materials and services purchased from others DEPRECIATION 19,034,191 56.71 1.58% Depreciation, maintenance and repairs on plant and equipment 529,285 1.58 Contributions to employees' profit sharing trust funds 434,573 1.29 Interest on indebtedness 13,650 .04 TRUST FUNDS State, local and miscellaneous taxes 113,504 .34II.34 Federal taxes on income of current period 66,__0835 1.97 1.29%

Total costs $32,487,419 96.79 DIVIDENDS .59%

9X44fìSrnefrm0~/4m0 $ 1,077,457 ea,e4 a#mbne4,4.. RETAINED 2.54%

Income tax adjustments for prior years 27,790 .08 INTEREST ON INDEBTEDNESS .04% ,epl6mowee $ 1,049,667 /

Katfrmiki-VezidekiWewa6 198,777 .59

dwekt-elezélealieLe kcJiieeJdAlewe weea6.. $ 850,890 2.54

100.00 WAGES 34.86% What happened to Fluor's 1949 gross NOTE:Covered by Auditor's Certification shown on page 21ofthis report income dollar.

Page Six Page Seven e941/ eincewie ti/eedeel i,9m11461#ie9ge9

OCTOBER 31 DECEMBER 31 glee raymialkw iweigedfrom 1949 048 11941 igo 1945 (1944'41 1943 1942 1940 Sales: Mos. ) GI)

Construction-Billing revenues 24,677,993 24,372,648 15,720,709 9,955,305 11,893,769 13,557,767 20,138,272 8,892,921 4,856,442 3,223,775 Manufactured Products (less discounts) 8,781,764 8,682,704 6,518,648 2,363,828 2,564,143 1,937,560 3,147,614 1,981,929 1,022,083 806,295 Royalties, discounts and other 105,119 141,780 162,729 56,446 8,402 9,464 40,405 22,420 28,188 28,614

TOTAL SALES AND REVENUES 33,564,876 33,197,132 22,402,086 12,375,579 14,466,314 15,504,791 23,326,291 10,897,260 5,906,713 4,058,684 9aer./X teaV (Meal Wages and Salaries 11,701,381 11,085,841 6,677,879 5,597,960 6,865,060 8,858,953 11,827,783 3,471,981 1,993,641 1,243,162 Materials and Services purchased from others 19,034,191 17,790,269 13,231,847 6,241,004 6,990,332 5,814,647 9,485,158 6,652,927 3,517,939 2,651,971 Depreciation, Maintenance and Repairs on plant and equipment 529,285 472,033 355,128 301,938 455,122 318,441 370,953 172,475 98,819 70,807 Contributions to employees profit sharing trust funds 434,573 751,582 415,917 37,126 21,633 233,844 514,135 140,729 65,000 Interest on indebtedness 13,650 16,830 21,860 23,223 23,498 17,051 26,280 10,056 17,021 20,187 State, local and miscellaneous taxes 113,504 74,249 35,788 25,823 24,137 45,847 39,748 38,428 19,698 11,761 Federal taxes on income (current year) 660,835 1,143,601 633,339 50,487 41,469 47,887 860,000 327,853 73,846 14,867 gi1\

TOTAL COSTS 32,487,419 31,334,405 11,371,758 12,277,561 14,421,251 15,336,670 23,124,057 10,814,449 5,785,964 4,012,755 g-X-4 Voidifecooteefrin Oetait;frim.. 1.077,457 1,862,727 1,030,328 98,018 45,063 168,121 202,234 82,811 120,749 45,929 Og-,e4 ergeata#9., Income tax claims and adjustments for prior years 27,790* 1,392' 53,357* 17,784* 51,632 5,571 9,810 52,965 5.290 Excess of sale price over par value of stock (stock premium) 238,875- 1,624 1,160 17,880 55,660 . 142,235 Appraised Value of assets fully amortized (1945) 318,083 and subsequent normal depreciation and retirements 15,149* 15,856* 74,030* 24,798* Renegotiation recoupment-net 113,858* Net proceeds from life insurance policies 39,199 Miscellaneous adjustments 2,051* 1,000 e.9k3 Vareptdegioeelincome 1,273,393 1,847,103 993,446 22,023 249,384 275413 344,469 98,192 173,714 51,219

glieroytelaikielardaim6 9e 198,777 192,496 128,648 32,162 87,480 88,932 83,354 48,623 25,449 aiweim541,6-mal6, litatèm4J: 1,074,616 1,654,607 864,798 10,139* 161,904 275,413 255,537 14,838 125,091 25,770 ffiwWoomaned)04~.4ftegieffeihey- er,a4. Proceeds from the sale of stock (par value) 159,250 1,450 22,350 69,575 184,850 16,350 80,425 25.000

31,188 205,516 50,770 g-X4) 4,4eiaireetancetne emeitzekihómainerfrieri9e 1,233,866 1,654,607 864,798 8,689* 184,254 344,988 440,387 e/ireite.944. Beginning of 10 year period-January I. 1940 472,618 728,904 523,388 End of each subsequent year 5,474,303 4,240,437 2,585,830 1,721,032 1 ,7 2 9,7 2 1 1,545,467 1,200,479 760,092

*Net Deduction 1

Page Eight Page Nine 180MeitedfrN

ment, was constructed to supply West Coast demands. A The high standards of Fluor products and services confident that they will prove deciding factors in realizing air intake but still consistent with sound structural principles. pipe bending machine, with a capacity for cold bends of had recognition in an even greater volume of business in an adequate profit margin in the face of the need to meet A> Improved panel design resulting in even tighter wall con- 1949 than in 1948. Cooling towers led all product sales with constantly increasing competition. struction with a saving in cost. 3" to 8" diameter pipe inclusive, was installed. Storage facilities for approximately 400 tons of pipe and some 100 tons a total of nearly $5,000,000. Customer Service facilities were transferred to the PULSATION 1)A^R'NERS: Maintenance of the preeminent of welding fittings are included in this installation. Foreseeing the beginning of the new highly coin= Manufacturing Division in order to give better service at position earned by Fluor in development of the Fluor Pulsa- petitive cycle into which American industry was inevitably lower cost. tion Dampener was assured by two major dampener devel- Yack<-"Jerey&k) treve(rafrd/(kee' moving, your company took appropriate steps to meet the AveitieleYi' 04a/i.e./Neil opments during the year. Fluor now offers a modified At the Paola plant, Construction and Manufactur- challenge of lowered profit margins on its products. ing facilities were separated. The Construction Department During the year new designs and improvements dampener, which will, in many instances, eliminate pulsa- Recognizing that better engineering and production now occupies new buildings constructed during the year. were developed for Fluor products. These include: tion sufficiently to produce substantial quiesence in plant practices would permit increased production at lesser costs- vibration. The second major dampener development, which To facilitate the manufacture of Fluor products at without loss of qualitya Product Engineering Department MUFFLERS: The new Series "D" Muffler System, which incor- should prove highly beneficial in new plant design, incor- Paola, a new steel warehouse, containing 2,000 square feet was created in the Manufacturing Division to study product porates new revolutionary features such as, starting sound porates dampening principles in header piping systems. of floor area was constructed for storage of small fittings, improvement, both performanceand production-wise. At attenuation at its source in the immediate proximity of the riteztíi, while existing facilities were expanded to permit fabrication the same time, a Budgetary Control System was established engine tending to produce better engine muffling, consistant of vessels up to 10' diameter and shell thickness of 3/4". To increase efficiency in job handling, Los Angeles to maintain closer control on costs. While the full effect of with minimum exhaust pressure . Installations were completed for oxygen and acety- Manufacturing departments were housed in a single, modern these steps will be felt only over a period of time, we are lene bulk storage and distribution systems in Plate Shop, COOLING TOWERS: Changes incorporated in our proven cool- building designed to permit an uninterrupted flow of work Structural and Pipe Fabrication Shops to cut oxygen and ing tower design, consisted primarily of:: from group to group. Included are Manufacturing office and acetylene costs and to eliminate maintenance and handling 1- New design drift eliminators to produce the same effective drafting personnel, Manufacturing Sales Engineering, and costs for individual oxygen and acetylene equipment. drift elimination, at the same time reducing the static pres- Manufacturing Cost Accounting. sure drop, making it possible to utilize greater tower air Plans have been completed to expand hot pipe capacity with the same horsepower. drat,.eMe,i-rr/tra&N 0/241 eAhMr44 bending facilities to handle hot bends up to and including Improved air intake louvres, permitting less resistance to A pipe fabrication shop, containing the latest equip- 24" pipe.

,,egYiee &een gece4aY,ike4 ,46ehicie9eiki

GAS FABRICATION COOLING BURBLE LABORATORY PULSATION CLEANERS WORK TOWERS CAPS COILS FINFANS SERVICE DAMPENERS MUFFLERS 54,583.40 89,807.65 1945 1,813,238.70 8,435.78 101,513.16 206,028.01 22,913.39 277,479.07 1,734,923.69 11,013.82 1,676.55 236,883.47 105,471.10 159,088.81 37,382.14 88,526.94 292,144.69 266,099.49 250,873.98 1941 4,272,695.37 27,497.44 371,174.93 822,792.73 500.00 252,892.77 291,333.47 204,655.1 9 I 2 4 , 6 7 2 . I! 1948 30.011.33 1,552,018.02 889,627.00 6,707.50 577,585.33 119,674.06 253,837.90 403,649.05 1949 *37,768.8501,754.20 63,002.90 1410.431.08 1,309,732.83 8,578.18 323,183.84

Page Eleven sionamormw- c:V 190 reritow

Fluor's engineering and construction sales set a new Fluor's growth of sales under such adverse condi- Both the Los Angeles Engineering Department and high record during 1949. The year was closed with a backlog tions is due, in part, to its excellent record and, in part, to its the Houston Gas-Gasoline Department are now complete of new orders nearly as great as the one with which we having increased its capacity in both extent and scope of within themselves, possessing process sections staffed by entered the year. engineering and construction work. Additions of capable and engineers who are recognized authorities in their types of For this achievement to be fully grasped, it should nationally known engineers to our staff have materially process; estimating sections; project engineering sections; be explained that the volume of new engineering and con- strengthened our engineering organization, with the result material sections; mechanical engineering sections, and struction contracts, placed during the past two years by the that we have a fully complemented engineering and con- drafting sections. industries which we serve, has been materially reduced from struction force second to none in the industry. the yearly volume during the previous six-year period, and The new system eliminates any overlapping of ac- that during the past eight years, the number of companies In January, 1949, all engineering and construction activities were streamlined into a single division. Included in tivities in the various departments and sections required to competing for this type of work has approximately doubled. perform a complete process, engineering and construction In consequence, the volume of business available to each of this new Engineering .and Construction Division, as reor- contract, thus permitting Fluor to do a better job at lowest the engineering and construction companies in our line of ganized, are the Los Angeles Engineering Department; the work has been greatly reduced, resulting in extremely keen Mid-Continent Gas-Gasoline Department, with headquar- costa requisite to survival under the present extremely competition with ensuant reduction in both prices and gross ters at Houston, Texas; and the far-flung activities of the competitive conditions within the construction industry earnings. Construction Department. serving the Oil, Gas, Chemical, and allied industries.

RAN, 4M ?ècá

GAS TREATING PLANT COMPLETED IN FISCAL YEAR 1949. RUNNING INTO ''.AL YEAR 1950... El Paso Natural Gas Company- RE-ABSORPTION PLANT McElroy Field, Texas COMPRESSOR STATION ADDITION Uni011 Oil Cotnpany-Wilmington, Calif. Humble Oil & Refining Company- GLYCOL DEHYDRATION PLANT QQQQQ - Tomball, Texas GASOLINE RECOVERY PLANT AND . PRESSURE MAINTENANCE STATION Humble Oil & Refining Company- DROSS REVERBERATORY PLANT Humble Oil & Refining Company- A nalmac, Texas American Smelting & Refinintt Co. Pickton, Texas COMPRESSOR STATION ADDITIONS Leadville, Colorado DUO-SOL PLANT Northern Natural Gas Company- POWER PLANT Union Oil Company -Oletim, Calif. Palmyra, Nebraska Kansas Power & Light Company- Northern Natural Gas Company- Hutchinson, Kansas H2S REMOVAL PLANT Cli fton, Kansas ADDITION TO ETHYL ALCOHOL PLANT R. S. Lytle-Coalinga, California Shell Chemical Corporation- GAS LIFT FACILITIES Deer Park, Texas COMPRESSOR PLANT ADDITION Ohio Oil CompanySouth Coles Levee, Shell Oil Company-Wilmington, Calif. OFF-SITE FACILITIES & POLY PLANT California Shell Oil ConzpanyMontreal, CHEMICAL PLANT ADDITIONS Quebec, Canadt.z American Potaslz & Chemical Corp. COMPRESSOR STATION ADDITIONS Trona, California Panhandle Eastern Pipe Line Company- PROPANE RECOVERY PLANT- . Sneed, Texas COMPRESSOR STATION ADDITIONS OFF-SITE FACILITIES Panhandle Eastern Pipe Line Company- Shell Oil Company-Seagraves, Texas Standard Oil Company-Whiting, Indiana Zo f ness, Texas GASOLINE PLANT WAX PLANT FACILITIES ABSORPTION AND H,S REMOVAL Shell Oil Company-Provident City, Texas AND AUXILIARIES PLANT AND COMPRESSOR PLANT DESALTING UNITS Sinclair Oil Company-East Chicago, Ind. POWER PLANT FACILITIES Richfield Oil Corporation- AND AUXILIARIES Cuyanm, California ABSORPTION AND COMPRESSOR PLANT Shell Oil Company-Deer Park, Texas Richfield Oil CorporationCuyanza, COMPRESSOR STATION California OIL REFINERY WITH COMPLETE FACILITIES Atlantic Seaboard Corporation- REFINERY PROCESSING UNIT Carter Oil Company-Billings, Montana Gilbert, W. Va. General Petroleum Corp.Torrance, . GASOLINE PLANT & GAS TREATING PLANT LIQUIFIED PETROLEUM GAS FACILITIES California El Paso Natural Gas Company- Shell Chemical Corporation- GASOLINE AND COMPRESSOR PLANT Monahans Field, Texas Houston, Texas Cities Production Corp.Chico, Texas

Ma. Page Thirteen

J. x,Avffidffuhe 1,949 Yefféee9e

The year 1949 was a year of achievement for Recovery of carbon dioxide as dry ice from Start up and test of amine plants for purification Fluor's Research and Development Department. Organ- sour natural gas. of natural gas. ized in 1941, this department had so grown in the scope Process design for removal of hydrogen sulfide, Design data and basis for hydrogen sulfide and extent of its activities that it became desirable in and carbon dioxide from natural gas. reabsorption plants. 1949 to reorganize it into two separate sectionsRe- Development of improved mathematical method for Study of catalytic cracker dust problems. search and Serviceand to subdivide these sections in rating cooling towers. Methods for rating of extended surface heat exchangers. turn. The Research Section was subdivided into three CHEMICA iGINEERING groups: Chemical Engineering, Chemistry, and Physi- cal Engineering. The Service Section was subdivided into two activities: Chemical Engineering and Physical Effects of pulsative flow on pressure drop in Field studies on gas cleaner performance in glycol-amine Engineering. gas pipe lines. gas treating plants. Establishing fundamental causes of metering errors 21 compressor plant pulsation surveys with Fluor involved in pulsative flow systems. designed mobile laboratory. Elimination of serious vibration in suspension bridge river crossing of large high pressure transmission lines. PHYSICAL .NGI¡dlING

Laboratory and field investigations of corrosion in amine gas treating plants. Equilibrium and heat data for glycol-amine treating plants. Workingin fields,the their specialists of respective made both numerous sections studiesa valuable nde surveys, Fluorto xperimentswhich successfully enabled Y torner solve r:MIS specific problemsand to cus- sphereof enlarge potential itsoWn customer service.

Page Fifteen 6 J/40ciditcwi ó /T744

The Sales Department of the Fluor Corporation, due consideration on practically all of the refinery, gas, and like that of many other companies, came into the post-war natural gasoline plants that will be available for construction period with greatly reduced personnel. We recognized that during the year, but we recognize that the number of snch with the advent of a buyer's market, an aggressive and com- jobs in 1950 will not support the Fluor Organization we prehensive sales force was imperative. have today. The Sales Department is, therefore, actively As far back as two years ago Fluor's Sales Depart- seeking process work in other fields. The new processes we ment anticipated the end of the boom and its effect on the have gained for sulfur production and recovery will company's products and services. A survey, executed at that open up many new prospects for work in the chemical fields time, confirmed our belief that the tremendous post-war oil during the coming year. We are also increasing our efforts refinery expansion was near its end. This made it obvious in the sale of central station electrical power facilities for that Fluor must expand its operations into other fields of public utilities. industry in order to assure itself a backlog of business that In the sale of Fluor manufactured products, the would occupy its facilities and highly specialized personnel. success of the Fluor-pioneered Fin-Fan units has been phe- Our survey further showed that large expenditures nomenal; however, this has resulted in a reductiOn in the in capital investments for the oil industry would be made use of cooling towers. To offset this, greater efforts will be outside the United States, but these expenditures would, in expended during 1950 to sell our cooling towers in industries most cases, be made in foreign currencies. The association where they have not previously been well known. Pulsation made with Head Wrightson in London, we feel, will permit dampening work has continued and new developments will Fluor to participate in some of these foreign operations with- allow wider use of these units. We also intend to concentrate out becoming too involved in foreign currency exchange in the 'selling of the new type of Fluor Series "D" Muffler L problems. System which is now ready for an aggressive sales campaign. During the last year the great increase in potential With the establishment of pipe fabricating facilities in Los In England and all other business in the Province of Alberta, Canada, resulted in our Angeles, we look forward to a greater increase in sales Sterling Areas ... establishment of sales representation in this territory. East- volume for pre-fabricated pipe. HEADWRIGHTSON ern Canada, which includes the larger oil refinery areas, is The Sales Department recognizes that the securing PROCESSES LTD. being covered adequately by an expanded group of sales of new business for Fluor on a satisfactory profit basis will TEESDALE HOUSE. offices in the Eastern part of the United States. present a serious challenge in the coming year, but with the BALTIC STREET, The Sales Department recognizes the challenge expansion of our potential sources of such business, we look LONDON, E. C. L, ENGLAND presented by the year 1950. We are confident of receiving forward with confidence to a successful 1950.

Page Sixteen Page Seventeen e

Unlike many companies, The Fluor Corporation Rind No. 2 this meant-an increase to their account of 4.85 is entirely owned by its employees. 32.4 per cent of Fluor per cent of their annual base pay, while employees partici- stock outstanding is held in two Employees' Benefit Trust pating in both Trust Funds realized an increase in their ad- Funds while the remaining shares are individually owned counts of 11.45 per cent of their annual base pay. by 357 employees or members of their families. Annual contributions made by Fluor into both This widespread Fluor ownership by its employees Trust Funds at the ending of each fiscal year are invested signifies a definite interest in the company's welfare, insures in Fluor stock, government bonds and other high-grade internal stability, and provides an incentive for continued securities. Earnings are pro rated to the accounts of the in- company expansion and development. An employee pro- dividual membership. All contributions plus accrued earn- gresses with Fluor because after six months of service he ings of the Trust Funds are held for payment to participating automatically becomes a participant in Trust Fund No. 2, members upon termination of service. where he is eligible to share in the eompany's annual profits. NEW SIC- K LEAVE POLICY. These two Trust Funds established by Fluor rot' Relations with our employees were excellent After two years with Fluor he is further benefited by gain- throughout the year. Fluor workers everywhere carried on_ Sick leave benefits for monthly-salaried employees* itsemployees are unique, so far as we have been able to ing membership in Trust Fund No. 1 which makes him eli- then-work with the same spirit of cooperation that has char- were. increased by virtue of a new policy developed during ascertain. Many companies sell stock to employees on with- gible for share in the -company's profits contributed to both acterized their efforts in the past, a factor which contributed the year. Employees now earn five days' sick leave after Trust Funds. holding plans, and a few such companies are employee- greatly to the results from the year's operations. 'Six months' service; 10 days a year after the first year; and owned. At Fluor, in consideration of service alone, em- - Fluor's contributions to these Trust Funds repre- One big reason Fluor has been able to consistently ' 15 days a year after five years. Sick leave can be accumu- ployees by virtue of their participation in the Trust Funds sent 20 per cent of net profit before taxes. In 1949 this keep relations with its employees on the highest plane is that - lated up to 130 days. amounted to $434,573. To those participating in Trust, hold group ownership of one-third of the Company's stock. the company since it was founded has always considered OTHER BENEFITS employees its most important asset. This has resulted in our There were no basic changes In the company's men and women realizing that they are all integral parts of other benefit plans, which are: six paid holidays' per year, the business-not just cogs in a machine. Employees' Trust Funds Nos. 1 and 2, Group Accident and Other reasons are: Fluor's policy of paying wages Sickness Insurance Hospital and Surgical Benefits, Group laDet .Iflt IOZ"-714 ¡Z.,' .. ... -1110,1.; eLC".71 r'u-mt bmet: Jirenetittrust.14.1ta jun iumbert thus and salaries at least equal to those paid by comparable Life Insurance. STATEMENT Or CREDIT SALANCE 05 RECORD CIF TRUSTEIU companies in the areas where we do business; providing t ssor131149,0 1. DE Mt f1.0 reoNento.,N. ...j..N Noe, et to; TO:Onot.bi p. .1.. *NM ..4. CMPLOYEE REST PERIODS . r,AtotES A m liberal benefits; giving serious attention to the health and CALI A 12 I 20 I 49 1. 5 0 0A.:;":::sNG 34971. Rest periods of 10 minutes in the morning and 15 1500 wN40..1 ST 1 Yea safety of our employees; and encouraging employee view- Le. ANGELESCALIF LICa 11.0 NON,t minutes in the afternoon were provided for all employees to, F points in order to make Fluor a better place to work in all P.!.1.27.: eteeso. pleto FA RNA °FM' ..E .pi 0,7.:...... r,ow...... , ,..,0.1...... N.,112.A% .,.,... trot! 7. 1,1*.11 kflIVed tto. otryNal tto ern..tto Rear ipinoent, iv it Neon*. N. TN cesopp..,"totepool N at our offices and plants. Noe.. ere I. At eV et lot M1ct orrull eoNP respects. Nett1....' pplItl .$ .5.0Port Novo. .to enee Poem et No toton p/ ' ...",.: :.,---!"7 ..,..' ,',---.- C'I, Z' voSt 5." 1171=N"..:".;reetetteer.71= 7, *"."""' ". Otne.ti.t ma. Not -to N.. to No NO. No. ot et Po. Preempt. o NI NI,k NN UraVve la No ° AoNoo 1010.". °NA 1.1010. wel poNo ..Nle lototot Olow Poe PP. of PON Develbpmenfs in the field of employee relations at 'EMPLOYEE COMMUNICATIONS QS. C6rusitto .1 IN. eeplopreir '...-.....-.P . .... '....-d.1. e.,stSI Crust fluothgt Flnor during 1949 consisted of the following: The company continued to publish its employee I. INDUSTRIAL RELATIONS DEPARTMENT FORMED magazine, Fluor-O-Scope, and added the following com- Although Fluor has had a personnel section for munication devices: new glass-covered bulletin boards at the Los Angeles plant, Fluor-O-Gram-a multigraphed let- Xeo many years, an Industrial Relations Department combining ¿iplg°9,04;re.J'AtAefiXemie*malatimtiek erie ì6/04yeeigeite personnel, training and safety, and employee communica- ter to announce "hot" company news to all employees, and NET WORTH AT END OF FISCAL YEAR NET 'WORTH AT END OF FISCAL YEAR tions, was formed to give increased attention to employee an improved company notice system.

FISCAL YEAR ENDING NET WORTH 'FISCAL YEAR ENDING NET WORTH matters, FLUOR SAFETY AWARDS VACATION POLICY LIBERALIZED The Fluor Corporation, which has received many December 31, 1941 $ 65,000.00 .0ctober 31, 1943 $395,048.74 I A new vacation policy for monthly-salaried ern- awards in the past for its consistently good safety record., December 31, 1942/ 210,437.63 .0ctober 31, 1944 609,541.41 ° AT ploYees* was instituted. This policy provides two weeks' added another citation to the trophy shelf in 1949: second December 31, 1943 336,944.20 place for the past five years in the Associated General Con- October 31; 1945 607,225.87 vacation after one year's service; three weeks after 15 years; December 31, 1944 zN 334,955.76 two extra weeks the 25th year; and three extra weeks the tractors of America, Inc., Accident Prevention Contest. October 31, 1945 327,071.56 October 31, 1946 626,754.05 30th year and every fifth year thereafter. .0ctober 31, 1946 336,244.73 October 31, 1947 792,155.76 *The new vacation policy, with one modification, ESTAnksHEIF PROGRAIVIS CONTINUED October 31, 1947 496,616.49. and the new sick leave policy in its entirety wet-e extended Fluor continued to sponsor and encourage ath etic October 31, 1948 ,1,159;858.45 October 31, 1948 823,925.99 to hourly-paid employees in the Los Angeles ni ill and Paola and social events, annual Christmas parties and the award- October 31, 1949. 1,046,881.36 October 31, 1949 , 1,398,014.26 shops during the year-. ing of Service Pins.

fit Page Eighteen Page Nineteen, , ,Wetitmee Yieel cháliX»,4 caMeriakelow e Jtn/ 4 CURRENT LIABILITIES Accounts payable: THE FLUOR CORPORATION,LTD. Trade accounts $2,043,602.32 Salaries and bonuses 483,302.79 October 31, 1949 Customers' credit balances 194,850.00 Contributions to employees' profit sharing trusts 434,572.96 Commissions 55,289.97 Payroll deductions and taxes 116,876.11 Local property taxes 43,434.97 $3,371,929.12 Federal taxes on incomeestimated: c1144e4; Provision for the current period 660,835.06 Total current liabilities $4,032,764.18

CURRENT ASSETS

Cash: DEFERRED INCOME Demand deposits $954,290.10 Fees billed in advance 282,068.17 Office and branch cash funds 1,500.00 $955,790.10 Accounts receivable: Trade accounts $3,973,157.31 CAPITAL STOCK AND SURPLUS Less reserve 1,000.00 Capital stock: $3,972,157.31 Authorized 40,000 shares of $25.00 par value per share Employeesofficers and sundry 28,591.27 4,000,748.58 Issued and outstanding 38,532 shares $963,300.00 Inventoriesat lower of cost or replacement market: Surplus: $1,357,255.54 Raw materials Capital surplus $713,751.22 Work in process 1,575,655.51 Earned surplus 3,797,251.63 4,511.002.85 5,474,302.85 Finished products 52,447.38 2,985,358.43 Cash surrender value of life insurance 12,935.17 $9,789,135.20 Total current assets $7,954,832.28

OTHER ASSETS NOTE: Stated at cost less normal depreciation including emergency facilities which were fu/Ir Affiliated corporationinvestment and advances $ 9,480.71 amortized at October 31, 1945 . The value of the emergency facilities still in use at that DepositsinSurance, etc. 41,705.00 51,185.71 date was credited to capital surplus and depreciation thereof is charged against capital surplus. PROPERTY, PLANT AND EQUIPMENT-Note Land $134,387.19 Buildings $738,861.54 Machinery and equipment 1,619,920.45 Office furniture, fixtures and equipment 252,771.08 KetVea&w.. Construction in process 21,128.26 $2,632,681.33 Less reserve for depreciation 1,062,095.68 1.570,585.65 1,704,972.84 December 21, 1949 appropriate. Our examination was made in accordance with gen- The Board of Directors erally accepted auditing standards and included all procedures which we considered necessary in the circumstances. PATENTS AND PATENT APPLICATIONS The Fluor Corporation, Ltd. Los Angeles, California In our opinion, the accompanying financial statements Patentsat cost, less amortization of $17,271.65 $ 11,286.43 present fairly the position of THE FLUOR CORPORATION, LTD. at Patent applications 15,972.11 27,258.54 We have examined the balance sheet of THE FLUOR October 31, 1949 and the results of its operations for 1/le year - CORPORATION, LTD. as of October 31, 1949 and the statement of then ended, in conformity with generally accepted accounting GOODWILL 1.00 net income for the year then ended, have reviewed the system of principles applied on a basis consistent whiz that of the preceding internal control and the accounting procedttres of the Company year. DEFERRED CHARGES without making a detailed audit of the transactions, have DICKINSON /4 EAGLE Insurance, taxes, etc. 50,884.83 examined or tested accounting records of the Company and other illand,supporting evidence, by methods and to the extent we deemed Certified Public Accountants $9,789,135.20

Page Twenty-one Page Twenty t goami9igrteciatir SHIRLEY E. MESERVE, Chairman SHIRLEY E. MESERVE, Chairman of the D. W. DARNELL Board J. S. FLUOR, JR. D. W. DARNELL, President W. E. DUNN J. S. FLUOR, JR., Executive Vice Ae.e1+ gefea4.4 wmiavez J. R. FLUOR President PARK ASH FRANCIS E. FISCHER PAUL E. JERDE RASMUS RASMUSSEN F. E. FISCHER W. E. DUNN, Vice President and D. W. DARNELL H. D. FISCHER W. W. JOSEPH GEORGE V. STRIXNER JOHN W. MOORE JOHN E. WINN J. P. WISEMAN General Manager J. B. DUQUESNOY J. S. FLUOR, JR. W. P. DOWNEY Engineering and F. M. STEPHENS Construction Division J. R. FLUOR, Vice President and efieeay 40e4ity-"ge 3ea/14 Establishes broad basic policies. General Manager Handles major financial matters. JOHN H. BEESON NORMAN L. EDSON LEONARD L. JONES RAYMOND C. SHIELDS Mann facturing Division ROY J. BUSH THOMAS H. HOGLAND CHARLES L. KING EMORY S. SIMON Declares dividends. J. P. WISEMAN, Vice President and BYRON A. DAHL G. B. HOWLETT REX ANDREW LASSON C. E. WILMETH Selects officers and sets their salaries. Director of Sales LEONARD W. DAIGLE D. W. ISEMINGER SHIRLEY E. MESERVE CARL R. WINANS Meets second Monday of every month. F. E. FISCHER, Secretary and Treasurer P. C. SHELLEY, Assistant Secretary 'liken 4. e ra/A1 &eatitile eofiffrieWee ,redmkairoizief;fiakiy. Ko~rtifiee JULIUS BLUM W. P. DOWNEY OWEN W. GAUDERN GEORGE W. MEYER D. W. DARNELL, Chairman J. S. FLuoR, JR., Chairman DARWIN L. BROWN W. EARL DUNN E. I. HUDSON DONALD V. STRIXNER SHIRLEY E. MESERVE 1.C. BECHTOLD HARRY FRANK DAVIS EUGENE G. DURANDO WILLIAM C. HUDSON JONAS C. WHITCOM B J. S. FLUOR, JR. L. VAN HORN H. S. FARNSWORTH THOMAS D. KINNIKIN W. E. DUNN J.P. KNEUBUHL J. R. FLUOR F. M. STEPHENS F. E. FISCHER Gathers for free exchange of information and ,reit een3e-eN4 J. F. GARDNER ideas between departments represented. JAMES T. ADAMS STANLEY M. CLASEN ALFRED R. HURST JESS W. PASSMORE Passes on all technical articles prepared by Serves as advisory board to the President. J. L. AINSWORTH GEORGE M. COPSEY HOWARD L. JERDE M. P. PASSMORE Plans overall coordination of Company policy. employees. FLOYD H. AMBROSE W. J. CRAWFORD FREDERIC W. LEE F. V. RIGG R. M. DITTMAR PAUL C. LINAM PERCY C. ROGERS Assists and advises the President in regard to Meets semi-monthly. F. T. AMBROSE, JR. R. L. AMBROSE STEVE DOTSON H. O. LITSEY FAY A. SACQUETY general problems of management. R. M. ASCHBACHER JACOB R. DOUGAN JOHN LOHRKE RONALD M. SAVAGE Reports to the President on the Company's KairtmeWee o,A00,13 HERBERT AUSTIN MALVIN E. DUGGAN H. H. MAURER FRED C. SCHAEFER operations. FRED J. BENNETT ANTHONY F. DURANDO H. D. MCDANNOLD JOHN T. SCHULER eme/Yetd-nemedtifieit4 WILFRED A. BERLS C. H. FOLLOWELL J. N. MCGUINESS HENRY P. SCHWEDER Meets every Tuesday morning. F. E. FISCHER, Chainnan EDWARD L. BISHOP GEORGE D. GAINES ROBERT L. MERRICK G. G. SCHWEIZER J. R. FLUOR ALVIE E. BLACKMAN R. W. GARFIELD ERNEST MONCRIEF PARK C. SHELLEY J. W. SHOEMAKER R. L. MERRICK WILLIAM A. BOLZ J. A. GRAHAM H. R. MORROW JAMES G. BOUNDS SAMUEL M. GUINN WALTER P. NELSON EM MIT E. SMITH N9/29iffinfell4e7 Receives requisitions for additional space or im- VICTOR M. BURCH THOMAS M. HENLEY HENRY L. Nuzum ALFRED SPRUELL Meserve, Mumper & Hughes, BORIS A. BUSHUEFF LEWIS J. HUMBERT JOHN A. PANNER LEONARD J. SWINGLE , provements of any kind to existing facilities. Los Angeles Investigates sale or purchase of company WILLIAM J. VANN FRANK WILHELM CLARENCE WOFFORD dffelfAiD property. Dickinson & Eagle, Los Angeles Meets semi-monthly.

The Annual Shareholders' meeting is held on the second Monday in January 4k/64 Mogiec/rff4,4 at 10 a.m. at the Company's Main Office in Los Angeles. Fluor is proud of the 105 employees who it takes in the welfare and well-being of each and have received Service Pin awards for periods of every member of its personnel. Anadditional 286 service ranging from 10 to 25 years. Long service is -employees have received five-year pins, and many s proof of employee loyalty, and provides Fluor with of the remaining 2,056 Fluor mcn and women will soon be eligible for that award. Alimpumw a feeling of justification in the sincere interest which Page Twenty-three Litho in U.S.A. DGE-G 11483 =