Good morning, and welcome to Fluor's Fourth Quarter and Year-end 2020 Earnings Conference Call. Today's conference is being recorded. At this time, all participants are in a listen-only mode. A question-and-answer session will follow management’s presentation. A replay of today's conference call will be available at approximately 10:30 a.m. Eastern Time today, accessible on Fluor's website at investor.fluor.com. The web replay will be available for 30 days. A telephone replay will also be available for seven days through a registration link, also accessible on Fluor's website at investor.fluor.com. At this time, for opening remarks, I would like to turn the call over to Jason Landkamer, Director of Investor Relations. Please go ahead, Mr. Landkamer.

Thank you. Good morning, and welcome to Fluor's 2020 fourth quarter conference call. With us today are David Constable, Fluor's Chief Executive Officer; and Joe Brennan, Fluor's Chief Financial Officer. We released our earnings announcement earlier this morning, and we are streaming a slide presentation on our website, which we will reference while making prepared remarks. Before getting started, I'd like to refer you to our safe harbor note regarding forward-looking statements, which is summarized on Slide 1. During today's presentation, we'll be making forward-looking statements, which reflect our current analysis of existing trends and information. There is an inherent risk that actual results and experiences could differ materially. You can find a discussion of our risk factors, which could potentially contribute to such differences, in our Form 10-K filed earlier today. During this call, we may discuss certain non-GAAP financial measures. Reconciliations of these amounts to the comparable GAAP measures are reflected in our earnings release and posted in the Investor Relations section of our website at investor.fluor.com. I'll now turn the call over to David Constable, Fluor's Chief Executive Officer. David?

Thank you, Jason, and good morning, everyone. Let's turn to slide 2 and get started. My first two official months back at Fluor have been extremely busy. The immediate priority was to reset and communicate our longer-term strategy and the corresponding organizational structure. As you know, we announced the new Fluor management team in January. Our collective focus is on the end markets where we have the right technical expertise to add value for our clients while earning a suitable return for our shareholders. The recent changes that have been implemented align our business around the strategic priorities identified for Fluor in the near term. As a reminder, our strategic priorities are to: Number one, drive growth across the portfolio; two, pursue contracts with fair and balanced terms; three, foster a high-performance culture with purpose; and four, reinforce financial discipline. On today's call, we will review our 2020 results and discuss our views on how 2021 is shaping up. For a longer-term view of Fluor's opportunities and key focus areas, please tune in to our Strategy Day from last month if you haven't had a chance to view it yet. Strategy Day kicked off one of the more exciting areas of change and growth in Fluor's long history. We are confident that the strategic plan as outlined will deliver a directional earnings range between $3 and $3.50 per share by 2024. Now to 2020. Please turn to slide 3. We ended the year with a backlog of $25.6 billion and full-year new awards of $9 billion. New awards clearly reflected the impact of the pandemic and its pressure on our clients. They also reflect our stringent pursuit criteria and strategy to reduce risk. Across our end markets, we saw clients delay capital spending plans while they waited for uncertainty from the pandemic to subside. Based on conversations with our clients, we are starting to see positive momentum and expect to see new awards pick up in the second half of 2021. We continue to see good prospects across our portfolio and are completing front-end work scopes to populate our future backlog. However, lower awards in 2020 will create a headwind for 2021 earnings. Before talking about what we are seeing for 2021, I want to reinforce that the people at Fluor have tackled the challenges of 2020 with resilience and energy that was unmatched. These challenges have made us all more adaptive, and I believe that the organization is truly motivated to successfully take the company forward into its next chapter. Now, let's turn to our business lines and how we are aligning our priorities with the opportunities ahead. Turning to slide 4. As we move into 2021, our Urban Solutions end markets are gaining momentum specifically in mining. We are seeing high demand for metals such as copper and iron ore. Last year, we booked a significant North American steel project, as well as several front-end studies that we expect will convert to follow-on EPCM awards in late 2021 and beyond. Late last year, we achieved practical completion for the BHP Spence copper project in Chile. We've had a long-term relationship supporting BHP's capital efforts, and we are proud to be completing another successful project for them. We are also encouraged by the opportunities we are seeing in our advanced technologies and life sciences end markets. Here, we are pursuing data centers and semiconductor opportunities in North America and major life sciences prospects in Europe. In addition, Fluor has just been selected for a large biotech project in Europe, and we are finalizing contract details now. This confirms our strategy to leverage front-end technical solutions into full EPC awards. Contract signature is expected by the end of Q1 2021, and we look forward to sharing more specifics at that time. Advanced technologies and life sciences are well-positioned to support our clients for advanced manufacturing projects. This includes opportunities arising from the U.S. government's executive order that is focused on the domestic supply chain for critical materials, including semiconductors, batteries, pharmaceuticals, and rare earth elements. Moving to slide 5. In infrastructure, we are well positioned for select opportunities in the U.S. due to urbanization and an aging infrastructure system. Furthermore, we believe these opportunities could be enhanced with the introduction of a federal infrastructure spending bill. As a reminder, and as messaged previously, infrastructure margins will be under pressure as legacy zero-margin projects are worked down through the year. Approximately 35% of our infrastructure revenue will come from zero-margin work in 2021. As we discussed during Strategy Day, we will be very selective in the infrastructure projects we pursue in the future. Each pursuit must have the right scope, the right client, the right location, the right contract terms, the right size, and importantly, the right execution team and resources. Our goal is to deliver predictable earnings and not chase top-line growth. This will be especially apparent in our infrastructure pursuits going forward. Turning to slide 6. The management team is very excited about the work we are doing in Mission Solutions and the opportunities we see in supporting our government clients going forward. As you know, we are keenly focused on growing our presence in the intelligence, cyber, and mission-critical infrastructure and operations markets. Furthermore, we continue to support the DOE and the National Nuclear Security Administration with its nuclear security, environmental remediation, and energy projects and operations. We expect that work to be a strong baseload for Fluor in the coming years. Please turn to slide 7. While we are optimistic about our prospects in Energy Solutions in 2021, we don't expect our clients to resume capital spending at a meaningful pace until later in 2021 and beyond. We are having productive conversations with our energy clients and are well-positioned to meet their growing needs. Importantly here, we are living in an ever-changing world, and Fluor continues to enhance its capabilities in the energy transition space. We fully expect this market to begin a larger part of our prospect pipeline as clients pivot themselves toward a lower carbon economy. Next, our chemicals clients see recovery in key sectors of the market, which are anticipated to translate into additional capital expenditures. This includes the specialty chemicals market, where we continue to see positive signs of investment with our existing clients and significant activity with ongoing pursuits. Also, future consumer demand in the battery market is translating into additional client investments associated with lithium and related battery chemicals. Now, let me give you a brief update on some of our key projects, starting with LNG Canada. Moving to slide 8. At our Strategy Day, Project Director, Phil Park, gave a full update on the good progress at LNG Canada and Kitimat. Earlier this month, the project received approval for its construction ramp-up plan from the Office of the Public Health Officer and Northern Health. We are coordinating with government and health authorities as our workforce on site increases, and we focus on our spring and summer construction program. Moving on to the Purple Line project. As mentioned on the third-quarter call, a settlement was reached between our Purple Line JV and the Maryland Transit Authority. We received the first payment in the fourth quarter and expect a second payment in the second half of 2021. This month, the design-build team for the Tappan Zee bridge filed a lawsuit against the New York State Thruway Authority for unapproved change orders. As a team, we agreed we had exhausted all other options for resolution and believe we are owed compensation. While we don't have a timeline for the resolution of these legal actions, we will keep you updated as the situation proceeds. Please turn to slide 9. With respect to our two challenged government projects, I'm pleased to report that on the Radford project, we have turned overall 113 systems to our clients, and we are essentially complete. The F.E. Warren project continues to make steady progress. Finally, we remain confident in the viability of our NuScale initiative. As stated last month, we are currently evaluating new investors and looking to reduce our ownership stake and capitalize on this clean energy investment. I'm very encouraged by the levels of interest we are seeing and believe that NuScale can provide sizable returns for Fluor over time. And now, I'll turn the call over to Joe for the financial update. Joe?

Yes. Thanks, David, and good morning, everyone. The main topics I'll discuss today are: one, an overview of our 2020 financial performance; two, an update on our liquidity and financial position; three, an update on our initiatives; and four, our outlook for 2021. You'll see that today's results are presented in alignment with our old reporting segments and includes Stork as part of continuing operations. Starting with our Q1 2021 results, we will be presenting our financials aligned with our other new business segments: Urban Solutions, Mission Solutions, and Energy Solutions. At that time, we also expect to report Stork as discontinued operations. We will maintain another segment which will principally represent NuScale. Our Radford and F.E. Warren projects will move back into Mission Solutions. As David said, Radford is essentially complete with all 113 systems turned over to BAE, while Warren will flow through at zero margin until its completion. Turning to slide 10. For 2020, Fluor reported a net loss from continuing operations attributable to Fluor of $294 million or a loss of $2.09 per diluted share. During the year, we recognized the following significant charges, most of which were recorded in quarter one: $298 million for impairments of goodwill and tangible assets, investments, and other assets; $60 million for current expected credit losses associated with Energy & Chemicals clients; $146 million for impairments of assets held for sale included in discontinued operations, of which $12 million related to goodwill; as well as significant forecast revisions for project positions due to COVID-19-related schedule delay and associated cost growth. Corporate G&A expenses for 2020 was $241 million, up from $166 million a year ago. For the full year, $47 million was due to foreign exchange currency losses, predominantly driven by the weakening of the U.S. dollar, and $42 million was attributable to the professional fees associated with the 2020 internal review. Our increased compensation expense of 2020 was primarily due to the impact of a higher price on stock-based compensation as our share price increased from the date of the grant to the end of the year. We achieved an estimated run rate savings of $140 million annually in our overhead expenses due to actions taken in 2020. It's important to note that these savings are spread across the business lines and in corporate overhead. As I mentioned last month, we expect to achieve an additional $100 million of annual savings over the next three years as we rationalize overhead to the new shape of our business. During the fourth quarter, we exited two of our European infrastructure P3 investments and received cash of approximately $20 million. We also have two North American joint ventures that we expect to exit later in 2021. Moving to slide 11. Our ending cash balance was $2.2 billion, up from 2019. Domestic available cash represented 32% of this total. We expect to see our cash holding steady around $2 billion through the year, with debt retirement being offset by divestitures and the liquidity improvement measures we have discussed in the past. Operating cash flow for the full year was $186 million, which included approximately $375 million of cash to fund our legacy projects. As you saw in our earnings release this morning, Fluor successfully renewed its lines of credit and entered into an amended and restated $1.65 billion credit facility, which matures in February of 2023 and replaces the previous revolving loan and letter of credit facilities. Additionally, our debt-to-capitalization requirement on this amendment facility was expanded to 0.65x, which gives us more flexibility and current borrowing capacity as we assess our capital needs moving forward. We believe this is the appropriate size facility we need to support our business, given the shift in our strategy, as well as another good example of our efforts we are making around the organization to make Fluor fit for purpose. In 2020, we continued the process of monetizing our investment in AMECO and the equipment rental business. Earlier in the year, we sold our operations in Jamaica, closed our operations in Mexico, and sold the equipment rental business owned by Stork. We announced on our Strategy Day call that we have received a letter of intent for our AMECO North America business and are now reviewing options for the remaining South America business. Please turn to slide 12. Our two main financial priorities in 2021 are further stabilizing our capital structure, which we plan to primarily do with debt retirement and divestitures, and booking a pipeline of work that fits our revised pursuit criteria and our strategies. We are introducing our 2021 adjusted EPS guidance of $0.50 to $0.80 per diluted share for continuing operations. This excludes NuScale-related expenses and any impact from foreign currency gains or losses, restructuring, or impairments. This also reflects Stork being a discontinued operation. As David said, we expect to see new awards begin to pick up in the back half of 2021 with significant EPS growth in 2022 as we begin to work these projects. Though we do not give quarterly guidance, Q1 results have historically reflected higher G&A expenses. While we are seeing green shoots around the business, the lingering effects of the pandemic will continue to keep awards depressed for the next few months. Furthermore, our existing backlog is still being impacted by the pandemic. Though our projects are back online for the most part, government restrictions have slowed down our progress and the rate at which we are able to grow our clients. Turning to slide 13. Our assumptions for 2021 include: a slight decline in revenue as compared to 2020; adjusted G&A expense of approximately $40 million to $50 million per quarter; and a tax rate of approximately 28%. We anticipate average full-year margins of 2% to 3% in Urban Solutions, 2.5% to 3% in Mission Solutions and margins of 2.5% to 3.5% in Energy Solutions, improving as the year progresses. These margins include the remaining impact of zero-margin work flowing through the business. We also anticipate 2021 capital expenditures to be below $100 million as we divest our AMECO business this year. As David reaffirmed, we maintain our long-term guidance of $3 to $3.50 of EPS by 2024. We are taking the necessary first steps by strengthening our balance sheet and focusing our growth on end markets where we see the best opportunities for revenue and margin expansion. With the COVID headwinds starting to subside, we will see a resumption of project awards to drive our profits over the next several years. And now, I'll turn the call over for questions. Operator, we're ready for our first question.

Thank you. We'll start out with Steven Fisher from UBS.

You mentioned the life sciences plant by the end of Q1. Can you just maybe give us a sense of what are the other big milestones or things we should be looking for that you want to achieve in the next couple of months up to the next earnings call, which would really kind of round out your first 100-plus days, give or take?

Good morning, Steven. Thank you for your question. We are very encouraged by the ATLS award in Europe, a large world-scale biotech facility that we are currently finalizing. This is encouraging as it confirms our advancement in the value chain, collaborating with our customers on front-end conceptual work, progressing to front-end design, and then moving into EPCM services. Regarding the first 100 days, we have positioned ourselves well. We have been diligently working on our new strategy, which was introduced in January, establishing a new structure and ensuring effective communication both externally and internally. Our efforts are focused on aligning our strategic priorities with our market approach across three business segments. Currently, a major focus is on engaging with customers and ensuring our strategic priorities align, and I can assure you that we've had positive discussions across the segments regarding our rollout. Another critical area in our 100-day plan will be on cost optimization. We have initiated this effort to optimize costs and ensure that Fluor is positioned well for the future. This is an extensive exercise, and I have experience with it from my previous roles. We are leading this initiative to simplify the organization and reduce complexity as much as possible, targeting overhead to improve effectiveness and efficiency. This will comprise a significant part of the official 100-day plan, concluding at the end of March. I am the executive sponsor for the cost-optimization program, with Joe on the Steering Committee alongside Mark Fields, who oversees product execution. Those are our key focus areas right now, Steven.

That's very helpful. And then, you mentioned completing some front-end work scopes that are going to lead to those bookings you have planned for the second half of the year. Can you just talk about some of the incoming front-end scopes and the pace of that, which have been set up for further backlog growth? And do you think the awards in the second half of the year will be strong enough to have a book-to-bill over one?

Thank you again. Looking at our prospects, as mentioned on Strategy Day and in the prepared remarks, we are experiencing a lingering impact from COVID into 2021. However, everything we observe within the company, discussions with our customers and clients, and insights from the markets and GDP suggestions indicate a strong outlook for the second half of the year. I've seen projections for growth in the U.S. of as much as 6.8% in that time frame. We find that encouraging, though the timing remains somewhat uncertain. As previously noted, our project timelines have been extended, particularly in 2020, and we are anticipating an increase in activity during the second half. We are currently engaged in various projects. Even in the first half, we see potential, including an international upstream project nearing an award. In Mission Solutions, our collaboration with the DOE is approaching completion. Additionally, I mentioned a biotech facility, and we have a chemicals project in the UK that is progressing well for Energy Solutions. There's also significant mining work scheduled for the second half, particularly in front-end work that will transition to EPCM projects, all of which will be reimbursable and spread across the U.S., Asia, Africa, and even a couple of jobs in Africa. Furthermore, we expect additional second-half work in data centers and another chemical project in the UK. Our efforts are widespread across all three segments, with a clear emphasis on the second half compared to the first half.

David, if I may just add, Steve, to your question around book to burn, we would expect to be closer to flat, meaning that we would be pushing that 1.0 book to burn by the end of the year. That obviously is contingent upon some of this overhang that we continue to see from COVID and when the capital markets will kind of jump back in, and we'll start seeing the release of some of the projects that David just outlined. But, in our modeling, we're looking to be close to that 1.0 book to burn ratio by the end of '21.

And next, we'll move to Jamie Cook with Credit Suisse.

I have two questions. First, in the 2021 guidance for Energy Solutions, you mentioned margins of 2.5% to 3%. However, during the call after the third-quarter conference call, you suggested that margins in Energy Solutions might reach a run rate of 5%. I want to confirm my understanding of this. If this is correct, what factors are contributing to the lower margin outlook compared to our expectations a few months ago? My second question relates to the earnings potential you mentioned last month, specifically the projected earnings range of $3 to $3.50 for 2021. Could you clarify how you anticipate reaching this target, particularly in terms of the contributions from cost reductions, possible divestiture of NuScale, and expected market growth? Any insights to help us understand the path to accelerated earnings growth would be appreciated. Thank you.

Jamie, thanks. I'll jump in on the first question relative to the margins in Energy Solutions. We still are maintaining our 4 to 6 guidance in the outward years, driving to that $3 to $3.50. What's occurring in '21 is, we're seeing some drag relative to COVID and starts and stops, being able to get folks on site to really drive that volume and get the progress, and specifically on a couple of very large projects as we see them today. And those volume impacts are having an overall impact on how our overhead is impacting the volume itself, meaning we got to get the machine cranked up as we get back into fabrication in the middle of the year. On our largest Energy Solutions project, we'll start to see those revenues jump and the margins increase as well. So, if you look at the trajectory of that 2.5% to 3.5% for Energy Solutions in '21, you would see a significantly lower number in quarter one and quarter two, and really ramping up closer to that 3.5% towards the end of the year. And as we start booking new and more profitable work under the new bidding guidelines, we would expect that to then be a more linear approach back to that 4% to 6% range as we progress out into '22.

Okay, Joe. Just to clarify, despite the challenges posed by COVID and project timelines, there has been no decline in the core profitability of the projects compared to the third quarter for Energy Solutions, just to be clear.

No, not at all.

That's absolutely true. We have some small areas where we're still negotiating with clients and have adopted conservative positions regarding total bid impacts. However, these have not significantly affected our overall margin percentage related to those projects. There will be extensive discussions to reach conclusions on some items, but we don't anticipate any impact as we move past the middle of the year, when the capital markets recover, and we can start incorporating more profitable backlog into the pipeline at this time.

Okay. Thanks. And then, just to help us the bridge to the $3 to $3.50 versus where we are today?

So, regarding the $3 to $3.50 range, we are still comfortable with our projections at that level, as mentioned in the prepared remarks. The blended margin corridor at the group level is between 4% and 6%. We have more front-end, higher-margin work in our mix, which will help us reach the higher end of our projected range. This is how you should consider the revenue growth needed to achieve that.

Is there an implied revenue number or benefit from some of the cost savings? I understand the range is 4% to 6%, but I'm assuming some of the cost reductions should contribute incrementally. Or is it too early to determine that?

One of your questions earlier was about NuScale. NuScale, any upside on that is not modeled into this at all. The $100 million is, obviously. But, the additional $100 million of savings we're going after that I spoke about that Joe and I are working on. So that is in that mix, obviously. And so, yes, that's how we get there.

And next, I move to Andy Kaplowitz with Citi.

David, so, in your initial conversations with customers, could you talk about their acceptance of sort of the strategy to reduce risk, focusing on cost-reimbursable projects? Are the projects that you mentioned you can win later in '21 and more in energy in '22, can you tell if this satisfies your risk parameters where you could actually record that 4% to 6% margin on this new work, but more cost-reimbursable or lower risk?

Thank you for the question, Andy. The projects I discussed with Steven earlier are all reimbursable. We've secured GMAX, specifically in ATLS data centers, where we finalized the deal quite late, so the risk is minimal. We're confident in this kind of contract structure, which allows for reimbursement up to a limit and shares any cost savings. Feedback from our customers has been very positive; they appreciate that we are remaining active in the EPC sector and leading engineering construction globally. Customers recognize that for us to succeed, we need a fair balance in our terms. Our conversations across various business areas have been productive. As you're aware, we will pursue infrastructure projects when we feel assured. We have a strong history with regional road and bridge projects and will be very selective with our approach in areas like Energy Solutions, where we have established relationships and negotiate manageable risks. Having experience as a customer myself, dealing with significant investments on multi-billion dollar projects in oil, gas, and petrochemicals, I understand the importance of having open discussions. When aiming to enhance internal rate returns post-FID, project cost and schedule become key priorities. Engaging customers on how to minimize their project life cycle costs is something they respond to well. Achieving this requires appropriate risk-sharing and avoiding unnecessary costs on the contractor side. Overall, we've been having fruitful discussions, Andy.

That's helpful, David. And so, Joe, you mentioned that you're working on a $100 million cost-out program. I know it's through 2024 now, and it's on top of the last one. But, what if anything that's baked into your guidance for 2021? I imagine a small amount? And can you accelerate it at all, or maybe just give us an update on what you're doing here in '21?

Thank you for the question. As David mentioned, we have been collaborating with an external advisor. The approach I discussed during Strategy Day involves working across the entire organization, from corporate G&A to the business lines. We have conducted approximately 100 interviews as part of what we are calling the diagnostic phase, which lasts around six to seven weeks. Our plan is to share our findings with David within the next three to four weeks, after which we will start ramping up the process to achieve the necessary optimization. I expect minimal impact in 2021, as we were able to identify $140 million in savings over the past 18 months. Moving forward, we are focusing on aligning the company's strategy with its operational footprint to ensure that new users and suppliers are aligned, ultimately leading to a smaller footprint and a more optimized model. In summary, while we anticipate little impact in 2021, we expect to see significant progress in the first half of 2022.

And next, I'll move to Jerry Revich with Goldman Sachs.

Can you provide insight into the revenue contribution of your green energy or carbon capture product and the expected bookings rhythm for 2021? Additionally, could you give us an approximate idea of the current size of the business and what you anticipate for 2022 and 2023?

Yes, that's a significant topic for Fluor. We are strategically positioned for the energy transition, which involves addressing the dual energy challenge. We need to meet the growing global energy demand while also focusing on cleaner, sustainable, and affordable energy solutions. This aligns well with our proprietary technology, particularly in carbon capture and storage, as well as our economy plus technology approach. Currently, we are engaged in several front-end projects related to carbon capture and storage. It’s still early in the process, primarily focused on front-end work, not only in carbon capture but also in biofuels, renewable fuels, and some initial efforts in hydrogen. As for the timeline for larger programs, that's still some time away. We are in the early stages, and we will need to monitor how things develop. Hopefully, we can provide more details as these projects progress. I have mentioned before that our initial customers are primarily focused on the development side, but we are starting to see major self-financed customers entering the space as they shift towards a lower carbon economy. They are looking into how to decarbonize their assets, and we have ongoing work in that area as well. However, I don't have specific figures at this moment. These projects are indeed EPC jobs aimed at improving efficiency and decarbonization. Overall, it’s still early in the energy transition process, and we will share more insights in future calls.

Okay. And then, can we shift gears and just talk about infrastructure with a change in focus for you folks? How are you thinking about the addressable market for infrastructure for you today versus the revenue rate that we're running at now? Obviously, you mentioned a third of the business is being run through at zero margins. What should the size of the segment look like as we get the new bids going? Is it a top line a third smaller than it is today, or do you think that there is scope to book and replace that business with good margin work?

Yes. We are currently focused on our zero-margin remaining projects in the legacy infrastructure portfolio, primarily this year and next. Progress is being made, and we are closely monitoring our efforts while collaborating with clients to ensure we have asserted our rights regarding COVID, force majeure, and changes in law across all our projects, including infrastructure. Moving forward, our main objective is to expand our successful business model from Texas to other states, with a particular emphasis on regional roads and bridges. Additionally, Terry Towle, our Group President in Urban Solutions, is prioritizing program management contracting plus potential reimbursable work, which is also gaining traction in managing large programs. We anticipate increased infrastructure spending ahead, especially in the U.S., where we are concentrating our efforts, alongside Canada. Although we expect a slight dip in revenues due to our new strategy, we are optimistic that the additional scope we are pursuing will help us return to historical levels in infrastructure.

With a significantly higher predictable delivery…

Sorry, yes. Yes.

And we’ll move on to Sean Eastman with KeyBanc Capital Markets.

I find the advanced facilities end market quite interesting and would like to gain some perspective. Could you provide an estimate of the revenue expected from advanced facilities in 2021 compared to its historical peaks? Additionally, can you discuss the current prospect pipeline in advanced facilities and how it compares to the previous peaks we have observed from Fluor in this sector?

Thanks, Sean, for the question. It's really heating up across ATLS. We're seeing growth not just in data centers and semiconductor work in advanced technologies, but also in life sciences, biotech, pharmaceuticals, contract manufacturing, advanced manufacturing, packaging, and food and beverage. The advanced facilities are starting to gain traction. The recent executive order is positive news for us, as it aligns with our Industry 4.0 trend we discussed during Strategy Day. The administration's focus on addressing the supply chain shortage is further supporting our target market. This trend bridges the physical and digital worlds, and Fluor's advanced technology group in Urban Solutions is well-positioned to meet the demand for data processing, semiconductors, storage, and data centers, as well as large capacity batteries for electric vehicles. We have the necessary capability and experience. While it's still early days in the U.S., localizing the supply chain plays to our strengths, and we expect growth in this area. I believe this growth is incorporated into our strategic projections, but with the current focus on enhancing local manufacturing capabilities, we could see additional upside in ATLS.

Okay, great. That's helpful. And just looking at the 2021 guidance, $0.50 to $0.80. Obviously, a lot of growth baked into that fiscal '24 target of $3 to $3.50. Could you give us a rough idea on sort of the cadence of where we are now versus the fiscal '24 target? I mean, is that growth more front-end weighted within that time frame, more back-end weighted? A rough idea there would be really helpful for a model.

The modeling we've done for our strategic plan indicates that due to the impact of COVID in 2020 and its lingering effects in the first half of this year, we will experience flatness throughout 2021. However, we expect a significant uplift in 2022, and by 2023, we anticipate much higher revenue and earnings. By that time, you'll really start to see our progress. Additionally, with recent accounting changes regarding how projects are recorded based on total project progress, this will also lead to earnings being more concentrated in the second half of our strategic planning period.

Yes. I would just add, David, we're looking at it as we start this booking with the diversification that we have across our segments that we would expect to see that more on a linear basis. There's not going to be a cyclicality, I think, from year-to-year based on where we are investing in our growth strategy moving forward. So, I would expect that more to be on a linear basis and probably with less cyclicality.

And we'll move on to Michael Dudas with Vertical Research Partners.

David, as you look ahead to 2021 and your expectations for new business, particularly in the latter half, which haven't been surprising given the challenges of the first half, among your three revised lines of business, which do you believe have the best chance to exceed a one-to-one book-to-bill ratio? How would you prioritize them? I understand your goal is to maintain stability as an organization, but which areas do you think will have the momentum heading into the end of the year and could drive further growth beyond that one-to-one ratio as you approach 2022?

Yes. I would likely favor Urban Solutions as my first choice. That’s where I would place my emphasis, Mike. However, there are also excellent opportunities in Mission Solutions, and if they materialize, they could be significant. So, I would rank it Urban Solutions first, followed by Mission Solutions, and then Energy Solutions, which is heavily engaged in energy transition work. Energy Solutions will likely come in third this year. We have chemical projects that will also support Energy Solutions in 2021. Overall, Energy Solutions will focus on medium-sized projects this year rather than massive ones. While these projects will still be substantial, in the multi-hundred-million-dollar range, they will not all be in the multibillion-dollar category.

That's a good point to follow up. So, in the new business model of Fluor, how are the size and length of projects changing? Are you focusing more on medium-sized projects, or does your cost structure allow you to take on small to medium work or book-to-burn work to meet your targets? Additionally, do you still rely on multibillion-dollar orders to make the new business model successful? How should we perceive this in light of your project announcements and progress going forward?

Thank you, Mike. I definitely believe that we will continue to be organized and maintain a global presence to manage very large, complex, multibillion-dollar reimbursable projects in the future. If oil prices and demand continue as they are, we anticipate a return to traditional upstream and downstream oil and gas work soon, based on current forecasts. We want to be prepared for that, as our clients rely on us to handle these substantial projects. However, I must point out that our clients have indicated their track record with mega projects has generally not been very strong. Therefore, much of the upcoming work is likely to involve more manageable phased programs with the possibility for expansions later on. You can expect to see an increase in midsized projects based on the feedback I'm receiving, but large mega projects will still occur from time to time.

David, despite what you just mentioned, if we review the long-term perspective, Fluor has historically executed approximately 80% of our projects in the mid to smaller size range. We have consistently prioritized this area. As we optimize our operations to better fit the market, we will enhance our competitiveness in this segment. While we may have moved away from this focus during the recent integrated solutions phase, medium-sized projects, which have evolved in definition today, have always been a crucial part of Fluor's revenue and profitability throughout the years.

Well, just, Mike, just to give a little more color on that. Those prospects I went through with Steven earlier, I can give you the revenue, the total installed cost, the TIC on those. The largest is $1.9 billion. There's a $770 million, $600 million, $280 million, $750 million, a $500 million, $900 million. They're in that range for 2021. And again, I think, you'll see some of the mega projects coming back as the oil price forecast start to firm up. And I fully expect to see CapEx flowing in the upstream, downstream arena as that demand takes off in traditional oil and gas.

As a final follow-up for Joe, regarding the 2021 earnings guide, it does not include Stork, anything discontinued, or NuScale. Can you provide some insight into the contributions that Stork would have made, what NuScale would have contributed, or how these relate to what we've been observing? Additionally, how much of the zero-margin work will impact the P&L in 2021 in terms of revenue and percentage profit?

I had a bit of trouble hearing. Let me address the last question first since I didn’t catch everything. The contributions from Stork would have been very minimal, likely just in the single million dollar range. Your last question pertained to the zero-margin revenue projects in our financials. Of the $1.8 billion we've outlined, we plan to push approximately $700 million of that through in 2021 and another $700 million in 2022. By the end of 2022, we will have accounted for about 85% to 90% of those zero-margin projects.

And NuScale was the other part of the question, like what would have been in '21?

NuScale in 2021 had expenses roughly around $80 million. Are you referring to the profit and loss side?

Is the guidance for '21 inclusive of NuScale?

Sorry. It does not. I have a little…

Thanks, Mike.

And that will conclude today's question-and-answer session. At this time, I would like to turn the call back over to David Constable for any additional or closing remarks.

Thank you, operator, and thanks to all of you for participating on our call today. Again, 2020 was a challenging year for the Company and the industry. As we start to implement our strategic plan and drive reliable and profitable growth across the portfolio, we will remain focused on increasing shareholder value, while at the same time, delivering world-class projects for our clients. So, we appreciate your interest in Fluor Corporation, and thank you for your time today.

And that will conclude today's call. We thank you for your participation.