Fluor Chief Says Firm Is in ‘Excellent’ Shape
A day after revealing that cancer is forcing him to retire in the middle of a major restructuring effort, Fluor Corp. Chairman Leslie McCraw says he is leaving the Irvine company in “excellent financial shape, with an excellent management team and a positive strategy.”
McCraw, who will step down Jan. 1 to devote his energies to battling bladder cancer, said in an interview Thursday that the global engineering and construction services firm “will continue to move forward” with the reorganization that he began earlier this year.
The 63-year-old executive’s early retirement will end a year in which Fluor’s profit and stock price plummeted and a massive cost-cutting program was initiated after the chairman acknowledged that an ambitious expansion drive he launched in the early 1990s was to blame for the company’s woes.
In March, McCraw said the company would fix itself by slashing $100 million from operating costs, mostly in its Fluor Daniel operating unit, and by dropping unprofitable business pursuits.
Fluor’s stock rose 94 cents to close at $36.06 on the New York Stock Exchange, but McCraw shrugged off suggestions that the gain was tied to his resignation announcement. He said he’s happy to see the stock go up “because I’m a major shareholder.” The stock is still more than 50% below its February high of $75.
McCraw also said Thursday that Fluor’s directors have hired a search firm to look outside the company for chairman-chief executive candidates. He noted, however, that the search is merely an effort “to see if there are any outside candidates as good as the people inside.”
Company observers say the leading contender is James Stein, 53, head of Fluor Daniel, the company’s core operating subsidiary. McCraw picked Stein in March to carry out the restructuring.
Industry analyst Robert Toomey of the Piper Jaffray brokerage said McCraw is leaving the company in good financial shape. “But his work in repositioning the company for long-term performance is unfinished,” he said. “That will be a challenge for his successor.”