Fluor 2011 Annual Report Download - page 67

generally able to cover our insurance needs, there can be no assurances that we can secure all necessary or
appropriate insurance in the future. We also monitor the financial health of the insurance companies from
which we procure insurance, and this is one of the factors we take into account when purchasing insurance.
Our insurance is purchased from a number of the world’s leading providers, often in layered insurance or
quota share arrangements. If any of our third party insurers fail, abruptly cancel our coverage or otherwise
can not satisfy their insurance requirements to us, then our overall risk exposure and operational expenses
could be increased and our business operations could be interrupted.
Any acquisitions, dispositions or other investments may present risks or uncertainties.
We have made and expect to continue to pursue selective acquisitions or dispositions of businesses, or
investments in strategic business opportunities. We cannot assure you that we will be able to locate suitable
acquisitions or investments, or that we will be able to consummate any such transactions on terms and
conditions acceptable to us, or that such transactions will be successful. Acquisitions may bring us into
businesses we have not previously conducted and expose us to additional business risks that are different
from those we have traditionally experienced. We also may encounter difficulties identifying all significant
risks during our due diligence activities or integrating acquisitions and successfully managing the growth
we expect to experience from these acquisitions. We may not be able to successfully cause a buyer of a
divested business to assume the liabilities of that business or, even if such liabilities are assumed, we may
have difficulties enforcing our rights, contractual or otherwise, against the buyer. We may invest in
companies that fail, causing a loss of all or part of our investment. In addition, if we determine that an
other-than-temporary decline in the fair value exists for a company in which we have invested, we may have
to write down that investment to its fair value and recognize the related write-down as an investment loss.
For cases in which we are required under equity method or the proportionate consolidation method of
accounting to recognize a proportionate share of another company’s income or loss, such income or loss
may impact our earnings.
In the event we make acquisitions using our stock as consideration, stockholders’ ownership percentage would
be diluted.
We intend to grow our business not only organically but also potentially through acquisitions. One
method of paying for acquisitions or to otherwise fund our corporate initiatives is through the issuance of
additional equity securities. If we do issue additional equity securities, the issuance would have the effect of
diluting our earnings per share and stockholders’ percentage ownership.
As a holding company, we are dependent on our subsidiaries for cash distributions to fund debt payments and other
corporate liabilities.
Because we are a holding company, we have no true operations or significant assets other than the
stock we own of our subsidiaries. We depend on dividends, loans and other distributions from these
subsidiaries to be able to service our indebtedness, fund share repurchases and satisfy other financial
obligations. Contractual limitations and legal regulations may restrict the ability of our subsidiaries to
make such distributions to us or, if made, may be insufficient to cover our financial obligations.
We maintain a workforce based upon current and anticipated workloads. If we do not receive future contract awards
or if these awards are delayed, significant cost may result.
Our estimates of future performance depend on, among other matters, whether and when we will
receive certain new contract awards, including the extent to which we utilize our workforce. The rate at
which we utilize our workforce is impacted by a variety of factors including our ability to manage attrition,
our ability to forecast our need for services which allows us to maintain an appropriately sized workforce,
our ability to transition employees from completed projects to new projects or between internal business
groups, and our need to devote resources to non-chargeable activities such as training or business
development. While our estimates are based upon our good faith judgment, these estimates can be
unreliable and may frequently change based on newly available information. In the case of large-scale
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