News Details

Fluor Corporation announced today a strategy to significantly improve its profitability and growth potential.

Speaking at the company's annual meeting, Chairman and Chief Executive Officer Philip J. Carroll Jr., told shareholders the company is initiating actions designed to increase return on operating assets from 9 percent in 1998 to above 13 percent, with a sustainable revenue growth rate of 10 percent within five years.

Carroll said, "We are implementing actions intended to deal with both deteriorating business environments in our two principal business segments and strategically position the company for profitability, growth and the creation of shareholder value longer term. The transformation we are initiating will help create a Fluor Corporation that is considerably stronger and more diversified than it is today."

Under the new strategic plan, Fluor Corporation will be organized into four business groups, each reporting to Carroll: Fluor Daniel, the company's engineering, procurement and construction (EPC) business, will be led by Alan L. Boeckmann; A.T. Massey Coal Company, will continue to be led by Don L. Blankenship; Fluor Global Services will be led by James C. Stein; and Shared Services, an in-house administrative service organization, will be led by James O. Rollans. In addition, a Global Business Development, Sales & Marketing group will be formed, led by John Hopkins, and also report to Carroll.

STRATEGIC ELEMENTS
--		Fluor Daniel will concentrate its EPC business focus and
		consolidate its organizational structure by closing 15 offices
		and eliminating 4,000 positions directly involved with project
		activity and 1,000 overhead positions by the end of 1999. The
		reduction in overhead coming from these actions will total $160
		million annually.
		A one-time charge of $130 million will be taken in the company's
		1999 second quarter for the implementation of these strategic
		actions, primarily for personnel and facilities costs. Looking
		forward, the new strategy of a more focused business coupled with
		increasingly challenging business conditions will reduce
		projections for new EPC awards for the year to approximately $6
		billion. The impact on Fluor Daniel's operating profits in 1999
		is projected to be nominal since higher levels of profit margins
		in current backlog and targeted new awards are expected to offset
		the volume decline.
--		A.T. Massey Coal Company has achieved an excellent record of
		earnings growth and operational efficiency over the past 10
		years. With its business experiencing price and volume
		deterioration, Massey will focus on further reducing costs,
		increasing productivity and optimizing its product mix. For the
		current year, Massey's operating earnings are projected to be
		approximately 13 percent below 1998 levels. Longer term, a
		priority will be placed on improving this group's return on
		assets. Massey's strategy will be to seek value-producing
		opportunities, such as joint ventures and other business
		combinations, to apply its efficient operating methods to a
		larger base of coal reserves.
--		Fluor Global Services will participate in industries which offer
		opportunities for high growth and profitability, with a near-term
		priority for substantial improvement in the return on assets.
		American Equipment Company and TRS Staffing Solutions will
		capitalize on the trend among clients toward outsourcing non-core
		activities to improve their return on assets. Government Services
		will be consolidated and provide unique capabilities to other
		government agencies beyond its current Department of Energy
		activities. Telecommunications will emphasize integration and
		asset optimization when serving clients requiring wireless,
		wireline and network application services. A new company,
		Operations, Maintenance & Consulting Services, will leverage
		Fluor's strong asset management capabilities in the high-growth
		capital asset management marketplace.
--		Fluor Corporation will consolidate most of its current business,
		administrative and support functions into a newly created Shared
		Services company that will deliver essential services to the
		company's portfolio of businesses. To provide a competitive
		advantage to its internal clients, work processes will be
		streamlined and automated, with competitive benchmarking used to
		drive down costs and define levels for performance excellence.
--		Using the account management concept, the Global Business
		Development, Sales & Marketing group will build on existing
		relationships with key customers and cross-sell all of Fluor's
		products and services.
--		The company has launched a major effort to upgrade systems and
		improve the use of information technology to harness the
		company's intellectual property. Fundamental work processes will
		be streamlined to reduce costs and increase efficiency. Over the
		next three years, $90 million in incremental costs will be
		incurred for these new systems and technologies.
--		Fluor Corporation's human resources policies and practices will
		be restructured to support its new strategic direction and
		operating priorities. This will include broad-based incentive
		compensation, based on contributions to shareholder value.

"While we are confident that these changes will advance the growth of shareholder value over the long term, the external business outlook today has severe challenges," Carroll remarked. "The repositioning of the company's business activities are expected to help mitigate the current business slowdown and capitalize on the eventual upturn in the capital investment cycle."

Commenting on Fluor Corporation's 1999 outlook, Carroll said net earnings from continuing operations (including the charge after tax of $93 million or $1.23 per share) are expected to be approximately $107 million, or $1.42 per share. These expected results are primarily due to the one-time charge, reduced operating earnings from coal operations and expenses associated with strategic actions not included in the reserve.

"Looking further ahead, by creating this portfolio of complementary businesses and leveraging our core strengths, we are confident that we will deliver significantly improved results to our shareholders," Carroll concluded.

Fluor Corporation (NYSE:FLR), with 1998 revenues of $13.5 billion, conducts business on a global basis in the fields of engineering, procurement and construction, global services and coal production.

NOTE:

This release contains forward-looking statements regarding projected improvements in return on assets and revenue growth, anticipated reductions in employment, facilities and other operating costs, expectations for new contract awards, expectations of growth in shareholder value, expected earnings and expectations relating to strategic initiatives and realignments. The release also contains forward-looking assessments of industry and competitive trends. Such forward-looking statements reflect current analysis of existing information.

Caution must be exercised in relying on forwarding-looking statements. Due to known and unknown risks, the Company's actual results may differ materially from its expected or projected results. Factors potentially contributing to such differences include, among others:

--		Global economic and business conditions;
--		The availability of credit and other sources of funding necessary
		to finance infrastructure projects;
--		Changes in political and social conditions in Asia and Latin
		America;
--		The Company's failure to receive anticipated new contract awards;
--		Customer cancellations of, or scope adjustments to, existing
		contracts;
--		Unanticipated difficulties incurred in the execution of
		construction contracts resulting cost overruns;
--		Fluctuations in the demand for, and price of, coal and other
		natural resource commodities;
--		Customer delays or defaults in making payments; and
--		Competition in the global engineering and construction industry.

The forward-looking statements are also based on various operating assumptions regarding, among other things, overhead costs and employment levels that may not be realized.

Additional information concerning factors that may influence the Company's results can be found in its press releases as well as its periodic filings with the Securities and Exchange Commission. In this regard, risk factors are specifically discussed under the heading "Item I. Business - Other Matters - Fluor Business Risks" in the Company's Form 10-K filed January 22, 1999. Such filings are available publicly and upon request from Fluor's Investor Relations Department: (949) 975-3909. The Company disclaims any intent or obligation to update its forward-looking statements.

Background Information

Fluor Corporation
Strategic Plan
for Fluor Daniel
Narrow target market and increase focus on fewer customers:
--		Focus primarily on 15 industry segments, while honoring customer
		relationships, alliances and current contracts.
--		Serve fewer customers, (approximately 200 key global clients).
--		Increase segmentation and selectivity process to re-focus
		resources on highest-value projects.
--		New emphasis on marketing and global project development,
		focusing on relationship-oriented, rather than project-oriented,
		client alliances and joint ventures.
--		Build specific differentiated value-based services.
		Streamline engineering, procurement and construction (EPC)
organizational structure from 17 operating companies to five industry
groups:
--		Oil, Gas & Power
--		Chemicals & Process
--		Infrastructure
--		Mining
--		Manufacturing
Contract in low margin business areas, except for unique clients
andprojects, for example:
--		Environmental
--		Commercial buildings
--		Pipelines in Western Europe and United States
--		Forest products
--		Exceptions may be made based on evaluations of opportunistic
		developments where the company has a performance advantage.
Restructure global procurement practices:
--		Major cost-reduction opportunity.
--		$4 billion spent through 52,000 suppliers annually.
--		Implement by November 1999.
Leaner organization; overhead reductions:
--		Reduce operating costs by $160 million annually.
--		4,000 positions directly involved with project activity and 1,000
		overhead positions will be eliminated by the end of 1999.
One-time charge:
--		One-time charge of $130 million will be taken to make these
		changes.
		Background Information
Expected results for Fluor Daniel:
--		Short term: reduced sales volume, increased profit.
--		Long term: positioned for growth when the global economy
		improves.
Fluor Corporation
Strategic Plan
for A.T. Massey Coal Company
Will continue to expand but at higher return on asset levels:
--		Coal price reductions expected to continue and will be offset
		with increased productivity and cost management.
--		Continued leadership in low-sulfur coal production and
		optimization of product mix.
--		Put more assets at Massey's disposal, possibly through the
		formation of joint ventures and other business combinations.
Fluor Corporation
Strategic Plan
for FLUOR GLOBAL SERVICES
Stand-alone units will be managed separately from Fluor Daniel:
--		American Equipment Company (AMECO), a global provider of
		construction and industrial equipment and other services.
--		TRS Staffing Solutions (TRS), a global enterprise of staffing
		specialists for contract and direct-hire personnel in niche
		industries.
--		Government Services, which performs environmental cleanup work at
		U.S. Department of Energy sites.
--		Operations, Maintenance & Consulting Services (OMCS), a new
		business offering.
Operations, Maintenance & Consulting Services:
--		Capitalize on trend by companies to outsource non-core
		activities.
--		Market is large and rapidly growing.
--		Fluor is well positioned to offer clients integrated services by
		leveraging:
--		Maintenance services businesses
--		Process technology capability
--		Plant engineering capability
--		Existing customer relationships
--		Logistics
		Background Information
--		Automation systems
--		Plant management and administration
--		Operations and maintenance consulting
		AMECO, TRS and Government Services, formerly under Fluor Daniel,
now will operate independently.
		AMECO, TRS and OMCS will benefit from the major outsourcing trend
in industries the company serves.
		Each business will have profit performance targets to be measured
against competitors.
Fluor Corporation
Strategic Plan
for Global Shared Services
		Create a world-class organization providing low-cost delivery of
high-quality, professional business, administrative and support
services:
--		Consolidate these services into a single organization to improve
		quality and reduce cost.
--		Company will be formed in July 1999.
--		Initial operating parameters defined October 1999.
--		Competitive benchmarking.
--		Service-level agreements.
--		Will contribute materially to overall financial success of the
		company.

Expanded IS, knowledge-management system, including an Enterprise Resource Management system, will be implemented to monitor financial and strategic measurements on a near real-time basis.

Spend $90 million dollars over the next three years.

Human resources policies and practices will be modified to support the company's new strategic direction, with changes in place by November.

Fluor Corporation, IrvineLisa Boyette, 949/975-3652 (Media Relations)Lila Churney, 949/975-3909 (Investor Relations)