10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2017

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from   to  

Commission File Number 1-12815

CHICAGO BRIDGE & IRON COMPANY N.V.

The Netherlands	Prinses Beatrixlaan 35	98-0420223
(State or other jurisdiction of	2595 AK The Hague	(I.R.S. Employer Identification No.)
incorporation or organization)	The Netherlands
	31 70 373 2010
	(Address and telephone number of principal executive offices)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    

x  Yes    o  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    

x  Yes    o  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o  (Do not check if a smaller reporting company)	Smaller reporting company	o
		Emerging growth company	o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    

o  Yes    x  No

The number of shares outstanding of the registrant’s common stock as of July 27, 2017 – 101,169,452

CHICAGO BRIDGE & IRON COMPANY N.V.

Table of Contents

	Page
PART I—FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
Statements of Operations—Three and Six Months Ended June 30, 2017 and 2016	3
Statements of Comprehensive Income (Loss) —Three and Six Months Ended June 30, 2017 and 2016	4
Balance Sheets—June 30, 2017 and December 31, 2016	5
Statements of Cash Flows—Six Months Ended June 30, 2017 and 2016	6
Statements of Changes in Shareholders’ Equity—Six Months Ended June 30, 2017 and 2016	7
Notes to Condensed Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3. Quantitative and Qualitative Disclosures About Market Risk	51
Item 4. Controls and Procedures	51
PART II—OTHER INFORMATION
Item 1. Legal Proceedings	52
Item 1A. Risk Factors	52
Item 6. Exhibits	53
Signatures	55

2

PART I—FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

CHICAGO BRIDGE & IRON COMPANY N.V.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
	(Unaudited)
Revenue	$	1,283,477		$	2,161,164		$	3,110,829		$	4,295,793
Cost of revenue	1,661,534			1,903,209			3,337,935			3,782,268
Gross (loss) profit	(378,057		)	257,955			(227,106		)	513,525
Selling and administrative expense	67,167			69,195			140,224			150,141
Intangibles amortization	6,377			6,464			12,863			13,541
Equity earnings	(8,655		)	(2,059		)	(16,266		)	(5,664		)
Other operating expense, net	3,637			1,107			3,668			927
Operating (loss) income from continuing operations	(446,583		)	183,248			(367,595		)	354,580
Interest expense	(34,714		)	(20,196		)	(58,815		)	(40,261		)
Interest income	882			2,754			2,110			4,934
(Loss) income from continuing operations before taxes	(480,415		)	165,806			(424,300		)	319,253
Income tax benefit (expense)	178,752			(41,937		)	165,048			(81,461		)
Net (loss) income from continuing operations	(301,663		)	123,869			(259,252		)	237,792
Net (loss) income from discontinued operations	(120,847		)	8,679			(111,353		)	14,718
Net (loss) income	(422,510		)	132,548			(370,605		)	252,510
Less: Net income attributable to noncontrolling interests ($457, $437, $870 and $885 related to discontinued operations)	(2,909		)	(8,709		)	(30,159		)	(21,746		)
Net (loss) income attributable to CB&I	$	(425,419	)	$	123,839		$	(400,764	)	$	230,764
Net (loss) income attributable to CB&I per share (Basic):
Continuing operations	$	(3.02	)	$	1.10		$	(2.87	)	$	2.07
Discontinued operations	(1.20		)	0.08			(1.11		)	0.13
Total	$	(4.22	)	$	1.18		$	(3.98	)	$	2.20
Net (loss) income attributable to CB&I per share (Diluted):
Continuing operations	$	(3.02	)	$	1.09		$	(2.87	)	$	2.05
Discontinued operations	(1.20		)	0.08			(1.11		)	0.13
Total	$	(4.22	)	$	1.17		$	(3.98	)	$	2.18
Weighted average shares outstanding:
Basic	100,866			105,298			100,660			105,051
Diluted	100,866			106,091			100,660			105,925
Cash dividends on shares:
Amount	$	7,062		$	7,372		$	14,109		$	14,731
Per share	$	0.07		$	0.07		$	0.14		$	0.14

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

3

CHICAGO BRIDGE & IRON COMPANY N.V.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
	(Unaudited)
Net (loss) income	$	(422,510	)	$	132,548		$	(370,605	)	$	252,510
Other comprehensive income (loss) from continuing operations, net of tax:
Change in cumulative translation adjustment	32,914			(23,691		)	57,324			(1,232		)
Change in unrealized fair value of cash flow hedges	457			(260		)	810			1,043
Change in unrecognized prior service pension credits/costs	56			(183		)	(20		)	(156		)
Change in unrecognized actuarial pension gains/losses	(6,612		)	4,569			(8,045		)	2,416
Other comprehensive income (loss) from discontinued operations, net of tax:
Change in cumulative translation adjustment	(225		)	30			270			263
Comprehensive (loss) income	(395,920		)	113,013			(320,266		)	254,844
Net income attributable to noncontrolling interests ($457, $437, $870 and $885 related to discontinued operations)	(2,909		)	(8,709		)	(30,159		)	(21,746		)
Change in cumulative translation adjustment attributable to noncontrolling interests	(651		)	713			(1,621		)	(544		)
Comprehensive (loss) income attributable to CB&I	$	(399,480	)	$	105,017		$	(352,046	)	$	232,554

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

4

CHICAGO BRIDGE & IRON COMPANY N.V.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

	June 30, 2017			December 31, 2016
	(Unaudited)
Assets
Cash and cash equivalents ($188,408 and $328,387 related to variable interest entities ("VIEs"))	$	354,920		$	490,679
Accounts receivable, net ($51,900 and $53,159 related to VIEs)	663,141			488,513
Inventory	158,818			190,102
Costs and estimated earnings in excess of billings ($6,263 and $26,186 related to VIEs)	418,038			410,749
Current assets of discontinued operations	—			414,732
Other current assets ($357,635 and $426,515 related to VIEs)	477,530			546,977
Total current assets	2,072,447			2,541,752
Equity investments	174,561			165,256
Property and equipment, net	502,426			505,944
Goodwill	2,829,214			2,813,803
Other intangibles, net	208,388			219,409
Deferred income taxes	876,969			730,108
Non-current assets of discontinued operations	—			462,144
Other non-current assets ($73,865 and $5,484 related to VIEs)	482,274			401,004
Total assets	$	7,146,279		$	7,839,420
Liabilities
Revolving facility and other short-term borrowings	$	374,000		$	407,500
Current maturities of long-term debt, net	1,469,320			503,910
Accounts payable ($353,343 and $337,089 related to VIEs)	976,929			964,548
Billings in excess of costs and estimated earnings ($441,481 and $407,325 related to VIEs)	1,704,464			1,395,349
Current liabilities of discontinued operations	—			247,469
Other current liabilities	953,567			1,017,473
Total current liabilities	5,478,280			4,536,249
Long-term debt, net	—			1,287,923
Deferred income taxes	8,937			7,307
Non-current liabilities of discontinued operations	—			5,388
Other non-current liabilities	438,852			441,216
Total liabilities	5,926,069			6,278,083
Shareholders’ Equity
Common stock, Euro .01 par value; shares authorized: 250,000; shares issued: 108,857 and 108,857; shares outstanding: 101,001 and 100,113	1,288			1,288
Additional paid-in capital	758,192			782,130
Retained earnings	955,733			1,370,606
Treasury stock, at cost: 7,856 and 8,744 shares	(296,351		)	(344,870		)
Accumulated other comprehensive loss	(346,898		)	(395,616		)
Total CB&I shareholders’ equity	1,071,964			1,413,538
Noncontrolling interests ($0 and $6,874 related to discontinued operations)	148,246			147,799
Total shareholders’ equity	1,220,210			1,561,337
Total liabilities and shareholders’ equity	$	7,146,279		$	7,839,420

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

5

CHICAGO BRIDGE & IRON COMPANY N.V.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Six Months Ended June 30,
	2017			2016
	(Unaudited)
Cash Flows from Operating Activities
Net (loss) income	$	(370,605	)	$	252,510
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	48,898			62,853
Loss on net assets sold (net of cash paid for transaction costs of $4,700)	60,117			—
Deferred income taxes	(141,866		)	68,932
Stock-based compensation expense	26,441			21,275
Other operating expense, net	1,644			934
Unrealized (gain) loss on foreign currency hedges	(3,687		)	2,863
Excess tax benefits from stock-based compensation	—			(46		)
Changes in operating assets and liabilities:
Increase in receivables, net	(164,655		)	(113,662		)
Change in contracts in progress, net	298,677			87,405
Decrease in inventory	32,988			15,334
Decrease in accounts payable	(57,913		)	(53,637		)
Increase in other current and non-current assets	(42,502		)	(12,764		)
Decrease in other current and non-current liabilities	(127,972		)	(22,878		)
(Increase) decrease in equity investments	(140		)	445
Change in other, net	(25,535		)	9,700
Net cash (used in) provided by operating activities	(466,110		)	319,264
Cash Flows from Investing Activities
Proceeds from sale of discontinued operation, net of cash sold	645,506			—
Capital expenditures	(34,300		)	(25,276		)
Advances with partners of proportionately consolidated ventures, net	50,384			(39,116		)
Proceeds from sale of property and equipment	1,609			4,302
Other, net	(9,858		)	(55,578		)
Net cash provided by (used in) investing activities	653,341			(115,668		)
Cash Flows from Financing Activities
Revolving facility and other short-term repayments, net	(33,500		)	(181,000		)
Advances with equity method and proportionately consolidated ventures, net	11,817			161,698
Repayments on long-term debt	(318,750		)	(75,000		)
Excess tax benefits from stock-based compensation	—			46
Purchase of treasury stock	(9,080		)	(7,970		)
Issuance of stock	7,176			8,864
Dividends paid	(14,109		)	(14,731		)
Distributions to noncontrolling interests	(24,298		)	(29,643		)
Revolving facility and deferred financing costs	(13,763		)	—
Net cash used in financing activities	(394,507		)	(137,736		)
Effect of exchange rate changes on cash and cash equivalents	57,040			(13,169		)
(Decrease) increase in cash and cash equivalents	(150,236		)	52,691
Cash and cash equivalents, beginning of period	505,156			550,221
Cash and cash equivalents, end of period	354,920			602,912
Cash and cash equivalents, end of period - discontinued operations	—			(16,596		)
Cash and cash equivalents, end of period - continuing operations	$	354,920		$	586,316

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

6

CHICAGO BRIDGE & IRON COMPANY N.V.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(In thousands, except per share data)

	Six Months Ended June 30, 2017
	Common Stock				Additional Paid-In Capital			Retained Earnings			Treasury Stock					Accumulated Other Comprehensive (Loss) Income			Non - controlling Interests			Total Shareholders’ Equity
	Shares		Amount								Shares		Amount
	(Unaudited)
Balance at December 31, 2016	100,113		$	1,288	$	782,130		$	1,370,606		8,744		$	(344,870	)	$	(395,616	)	$	147,799		$	1,561,337
Net (loss) income	—		—		—			(400,764		)	—		—			—			30,159			(370,605		)
Disposition	—		—		—			—			—		—			—			(7,035		)	(7,035		)
Change in cumulative translation adjustment, net	—		—		—			—			—		—			55,973			1,621			57,594
Change in unrealized fair value of cash flow hedges, net	—		—		—			—			—		—			810			—			810
Change in unrecognized prior service pension credits/costs, net	—		—		—			—			—		—			(20		)	—			(20		)
Change in unrecognized actuarial pension gains/losses, net	—		—		—			—			—		—			(8,045		)	—			(8,045		)
Distributions to noncontrolling interests	—		—		—			—			—		—			—			(24,298		)	(24,298		)
Dividends paid ($0.14 per share)	—		—		—			(14,109		)	—		—			—			—			(14,109		)
Stock-based compensation expense	—		—		26,441			—			—		—			—			—			26,441
Purchase of treasury stock	(299	)	—		—			—			299		(9,080		)	—			—			(9,080		)
Issuance of stock	1,187		—		(50,379		)	—			(1,187	)	57,599			—			—			7,220
Balance at June 30, 2017	101,001		$	1,288	$	758,192		$	955,733		7,856		$	(296,351	)	$	(346,898	)	$	148,246		$	1,220,210

	Six Months Ended June 30, 2016
	Common Stock				Additional Paid-In Capital			Retained Earnings			Treasury Stock					Accumulated Other Comprehensive (Loss) Income			Non - controlling Interests			Total Shareholders’ Equity
	Shares		Amount								Shares		Amount
	(Unaudited)
Balance at December 31, 2015	104,427		$	1,288	$	800,641		$	1,712,508		4,430		$	(206,407	)	$	(294,040	)	$	149,600		$	2,163,590
Net income	—		—		—			230,764			—		—			—			21,746			252,510
Change in cumulative translation adjustment, net	—		—		—			—			—		—			(1,513		)	544			(969		)
Change in unrealized fair value of cash flow hedges, net	—		—		—			—			—		—			1,043			—			1,043
Change in unrecognized prior service pension credits/costs, net	—		—		—			—			—		—			(156		)	—			(156		)
Change in unrecognized actuarial pension gains/losses, net	—		—		—			—			—		—			2,416			—			2,416
Distributions to noncontrolling interests	—		—		—			—			—		—			—			(29,643		)	(29,643		)
Dividends paid ($0.14 per share)	—		—		—			(14,731		)	—		—			—			—			(14,731		)
Stock-based compensation expense	—		—		21,275			—			—		—			—			—			21,275
Purchase of treasury stock	(237	)	—		—			—			237		(7,970		)	—			—			(7,970		)
Issuance of stock	1,125		—		(49,573		)	—			(1,125	)	52,171			—			—			2,598
Balance at June 30, 2016	105,315		$	1,288	$	772,343		$	1,928,541		3,542		$	(162,206	)	$	(292,250	)	$	142,247		$	2,389,963

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

7

CHICAGO BRIDGE & IRON COMPANY N.V.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2017

($ and share values in thousands, except per share data)

(Unaudited)

1. ORGANIZATION AND NATURE OF OPERATIONS

Organization and Nature of Operations—Founded in 1889, Chicago Bridge & Iron Company N.V. (“CB&I”, “we”, “our” or “us”) provides a wide range of services, including conceptual design, technology, engineering, procurement, fabrication, modularization, construction and commissioning services to customers in the energy infrastructure market throughout the world. Our business is aligned into three operating groups, which represent our reportable segments: Engineering & Construction; Fabrication Services; and Technology. See Note 2 and Note 4 for discussions of our discontinued operations and Note 15 for a discussion of our reportable segments and related financial information.

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting and Consolidation—The accompanying unaudited interim Condensed Consolidated Financial Statements (“Financial Statements”) are prepared in accordance with the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (the “SEC”) and accounting principles generally accepted in the United States of America (“U.S. GAAP”). These Financial Statements include all wholly-owned subsidiaries and those entities which we are required to consolidate. See the “Partnering Arrangements” section of this footnote for further discussion of our consolidation policy for those entities that are not wholly-owned. Intercompany balances and transactions are eliminated in consolidation.

Basis of Presentation—We believe these Financial Statements include all adjustments, which are of a normal recurring nature, necessary for a fair presentation of our results of operations for the three and six months ended June 30, 2017 and 2016, our financial position as of June 30, 2017 and our cash flows for the six months ended June 30, 2017 and 2016. The December 31, 2016 Condensed Consolidated Balance Sheet (the “Balance Sheet”) was derived from our December 31, 2016 audited Consolidated Balance Sheet, adjusted to conform to our current year presentation.

On February 27, 2017, we entered into a definitive agreement (the “CS Agreement”) with CSVC Acquisition Corp (“CSVC”), under which CSVC agreed to acquire our capital services operations, which are primarily comprised of our former Capital Services reportable segment and provides comprehensive and integrated maintenance services, environmental engineering and remediation, construction services, program management, and disaster response and recovery services for private-sector customers and governments (the “Capital Services Operations”). We completed the sale of our Capital Services Operations on June 30, 2017 (the “Closing Date”). We considered the Capital Services Operations to be a discontinued operation in the first quarter 2017, as the divestiture represented a strategic shift and will have a material effect on our operations and financial results. Operating results of the Capital Services Operations have been classified as a discontinued operation within the Condensed Consolidated Statements of Operations (the “Statement of Operations”) for the three and six months ended June 30, 2017 and 2016. Further, the assets and liabilities of the Capital Services Operations have been classified as assets and liabilities of discontinued operations within our December 31, 2016 Balance Sheet, and our June 30, 2017 Balance Sheet reflects the impact of the sale. Cash flows of the Capital Services Operations are not reported separately within our Condensed Consolidated Statements of Cash flows. Unless otherwise noted, the footnotes to our Financial Statements relate to our continuing operations. See Note 4 for additional discussion of our discontinued operations and the impact of the sale of the Capital Services Operations.

In July 2017, we initiated a plan to market and sell our Technology operations (primarily comprised of our Technology reportable segment) and Engineered Products operations (representing a portion of our Fabrication Services reportable segment) (collectively, the “Technology Operations”), the proceeds of which will be used to significantly reduce our outstanding debt. We anticipate classifying the Technology Operations as held for sale during the third quarter 2017.

We believe the disclosures accompanying these Financial Statements are adequate to make the information presented not misleading. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC for interim reporting periods. The results of operations and cash flows for the interim periods are not necessarily indicative of the results to be expected for the full year. The accompanying Financial Statements should be read in conjunction with our Consolidated Financial Statements and notes thereto included in our 2016 Annual Report on Form 10-K (“2016 Annual Report”).

8

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Use of Estimates—The preparation of our Financial Statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. We believe the most significant estimates and judgments are associated with revenue recognition for our contracts, including estimating costs and the recognition of incentive fees and unapproved change orders and claims; fair value and recoverability assessments that must be periodically performed with respect to long-lived tangible assets, goodwill and other intangible assets; valuation of deferred tax assets and financial instruments; the determination of liabilities related to self-insurance programs and income taxes; and consolidation determinations with respect to our partnering arrangements. If the underlying estimates and assumptions upon which our Financial Statements are based change in the future, actual amounts may differ from those included in the accompanying Financial Statements.

Revenue Recognition—Our revenue is primarily derived from long-term contracts and is generally recognized using the percentage of completion (“POC”) method, primarily based on the percentage that actual costs-to-date bear to total estimated costs to complete each contract. We follow the guidance of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Revenue Recognition Topic 605-35 for accounting policies relating to our use of the POC method, estimating costs, and revenue recognition, including the recognition of incentive fees, unapproved change orders and claims, and combining and segmenting contracts. We primarily utilize the cost-to-cost approach to estimate POC as we believe this method is less subjective than relying on assessments of physical progress. Under the cost-to-cost approach, the use of estimated costs to complete each contract is a significant variable in the process of determining recognized revenue and is a significant factor in the accounting for contracts. Significant estimates that impact the cost to complete each contract are costs of engineering, materials, components, equipment, labor and subcontracts; labor productivity; schedule durations, including subcontractor or supplier progress; liquidated damages; contract disputes, including claims; achievement of contractual performance requirements; and contingency, among others. The cumulative impact of revisions in total cost estimates during the progress of work is reflected in the period in which these changes become known, including, to the extent required, the reversal of profit recognized in prior periods and the recognition of losses expected to be incurred on contracts in progress. Due to the various estimates inherent in our contract accounting, actual results could differ from those estimates. See Note 14 for discussion of projects with significant changes in estimated margins during the three and six months ended June 30, 2017 and 2016.

Our long-term contracts are awarded on a competitively bid and negotiated basis and the timing of revenue recognition may be impacted by the terms of such contracts. We use a range of contracting options, including cost-reimbursable, fixed-price and hybrid, which has both cost-reimbursable and fixed-price characteristics. Fixed-price contracts, and hybrid contracts with a more significant fixed-price component, tend to provide us with greater control over project schedule and the timing of when work is performed and costs are incurred, and accordingly, when revenue is recognized. Cost-reimbursable contracts, and hybrid contracts with a more significant cost-reimbursable component, generally provide our customers with greater influence over the timing of when we perform our work, and accordingly, such contracts often result in less predictability with respect to the timing of revenue recognition. Contract revenue for our long-term contracts recognized under the POC method reflects the original contract price adjusted for approved change orders and estimated recoveries for incentive fees, unapproved change orders and claims, and liquidated damages. We recognize revenue associated with incentive fees when the value can be reliably estimated and recovery is probable. We recognize revenue associated with unapproved change orders and claims to the extent the related costs have been incurred, the value can be reliably estimated and recovery is probable. Our recorded incentive fees, unapproved change orders and claims reflect our best estimate of recovery amounts; however, the ultimate resolution and amounts received could differ from these estimates. Liquidated damages are reflected as a reduction to contract price to the extent they are deemed probable. See Note 14 for additional discussion of our recorded unapproved change orders, claims and incentives.

With respect to our engineering, procurement, and construction (“EPC”) services, our contracts are not segmented between types of services, such as engineering and construction, if each of the EPC components is negotiated concurrently or if the pricing of any such services is subject to the ultimate negotiation and agreement of the entire EPC contract. However, an EPC contract including technology or fabrication services may be segmented if we satisfy the segmenting criteria in ASC 605-35. Revenue recorded in these situations is based on our prices and terms for similar services to third party customers. Segmenting a contract may result in different interim rates of profitability for each scope of service than if we had recognized revenue without segmenting. In some instances, we may combine contracts that are entered into in multiple phases, but are interdependent and include pricing considerations by us and the customer that are impacted by all phases of the project. Otherwise, if each phase is independent of the other and pricing considerations do not give effect to another phase, the contracts will not be combined.

9

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Cost of revenue for our long-term contracts includes direct contract costs, such as materials and labor, and indirect costs that are attributable to contract activity. The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Projects with costs and estimated earnings recognized to date in excess of cumulative billings is reported on the Balance Sheet as costs and estimated earnings in excess of billings. Projects with cumulative billings in excess of costs and estimated earnings recognized to date is reported on the Balance Sheet as billings in excess of costs and estimated earnings. The net balances on our Balance Sheet are collectively referred to as Contracts in Progress, net and the components of these balances at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017						December 31, 2016
	Asset			Liability			Asset			Liability
Costs and estimated earnings on contracts in progress	$	4,334,524		$	28,697,752		$	8,466,638		$	23,408,316
Billings on contracts in progress	(3,916,486		)	(30,402,216		)	(8,055,889		)	(24,803,665		)
Contracts in progress, net	$	418,038		$	(1,704,464	)	$	410,749		$	(1,395,349	)

Any uncollected billed amounts, including contract retentions, are reported as accounts receivable. At June 30, 2017 and December 31, 2016, accounts receivable included contract retentions of approximately $64,500 and $72,100, respectively. Contract retentions due beyond one year were approximately $46,600 and $37,500 at June 30, 2017 and December 31, 2016, respectively.

Revenue for our service contracts that do not satisfy the criteria for revenue recognition under the POC method is recorded at the time services are performed. Revenue associated with incentive fees for these contracts is recognized when earned. Unbilled receivables for our service contracts are recorded within accounts receivable and were approximately $9,600 and $16,100 at June 30, 2017 and December 31, 2016, respectively.

Revenue for our pipe and steel fabrication and catalyst manufacturing contracts that are independent of an EPC contract, or for which we satisfy the segmentation criteria discussed above, is recognized upon shipment of the fabricated or manufactured units. During the fabrication or manufacturing process, all related direct and allocable indirect costs are capitalized as work in process inventory and such costs are recorded as cost of revenue at the time of shipment.

Our billed and unbilled revenue may be exposed to potential credit risk if our customers should encounter financial difficulties, and we maintain reserves for specifically-identified potential uncollectible receivables. At June 30, 2017 and December 31, 2016, our allowances for doubtful accounts were not material.

Other Operating Expense (Income), Net—Other operating expense (income), net generally represents (gains) losses associated with the sale or disposition of property and equipment. For the three and six months ended June 30, 2017, other operating (income) expense, net also included accrued future operating lease expense for vacated facility capacity where we remain contractually obligated to a lessor of approximately $3,000.

Recoverability of Goodwill—Goodwill is not amortized to earnings, but instead is reviewed for impairment at least annually at a reporting unit level, absent any indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based upon balances as of October 1. We identify a potential impairment by comparing the fair value of the applicable reporting unit to its net book value, including goodwill. If the net book value exceeds the fair value of the reporting unit, an indication of potential impairment exists, and we measure the impairment by comparing the carrying value of the reporting unit’s goodwill to its implied fair value. To determine the fair value of our reporting units and test for impairment, we utilize an income approach (discounted cash flow method) as we believe this is the most direct approach to incorporate the specific economic attributes and risk profiles of our reporting units into our valuation model. This is consistent with the methodology used to determine the fair value of our reporting units in previous years. We generally do not utilize a market approach given the lack of relevant information generated by market transactions involving comparable businesses. However, to the extent market indicators of fair value become available, we consider such market indicators in our discounted cash flow analysis and determination of fair value. See Note 6 for additional discussion of our goodwill.

Recoverability of Other Long-Lived Assets—We amortize our finite-lived intangible assets on a straight-line basis with lives ranging from 6 to 20 years, absent any indicators of impairment. We review tangible assets and finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If a recoverability assessment is required, the estimated future cash flow associated with the asset or asset group will be compared to their respective carrying amounts to determine if an impairment exists. See Note 6 for additional discussion of our intangible assets.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Earnings Per Share (“EPS”)—Basic EPS is calculated by dividing net income attributable to CB&I by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the assumed conversion of dilutive securities, consisting of restricted shares, performance based shares (where performance criteria have been met), stock options and directors’ deferred-fee shares. See Note 3 for calculations associated with basic and diluted EPS.

Cash Equivalents—Cash equivalents are considered to be highly liquid securities with original maturities of three months or less.

Inventory—Inventory is recorded at the lower of cost and net realizable value and cost is determined using the first-in-first-out or weighted-average cost method. The cost of inventory includes acquisition costs, production or conversion costs, and other costs incurred to bring the inventory to a current location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. An allowance for excess or inactive inventory is recorded based upon an analysis that considers current inventory levels, historical usage patterns, estimates of future sales expectations and salvage value. See Note 5 for additional discussion of our inventory.

Foreign Currency—The nature of our business activities involves the management of various financial and market risks, including those related to changes in foreign currency exchange rates. The effects of translating financial statements of foreign operations into our reporting currency are recognized as a cumulative translation adjustment in accumulated other comprehensive income (loss) (“AOCI”) which is net of tax, where applicable. Foreign currency transactional and re-measurement exchange gains (losses) are included within cost of revenue and were not material for the three and six months ended June 30, 2017 and 2016.

Financial Instruments—We do not engage in currency speculation; however, we utilize foreign currency exchange rate derivatives on an ongoing basis to hedge against certain foreign currency related operating exposures. We generally seek hedge accounting treatment for contracts used to hedge operating exposures and designate them as cash flow hedges. Therefore, gains and losses, exclusive of credit risk and forward points (which represent the time value component of the fair value of our derivative positions), are included in AOCI until the associated underlying operating exposure impacts our earnings. Changes in the fair value of (1) credit risk and forward points, (2) instruments deemed ineffective during the period, and (3) instruments that we do not designate as cash flow hedges are recognized within cost of revenue.

For those contracts designated as cash flow hedges, we document all relationships between the derivative instruments and associated hedged items, as well as our risk-management objectives and strategy for undertaking hedge transactions. This process includes linking all derivatives to specific firm commitments or highly-probable forecasted transactions. We continually assess, at inception and on an ongoing basis, the effectiveness of derivative instruments in offsetting changes in the cash flow of the designated hedged items. Hedge accounting designation is discontinued when (1) it is determined that the derivative is no longer highly effective in offsetting changes in the cash flow of the hedged item, including firm commitments or forecasted transactions, (2) the derivative is sold, terminated, exercised, or expires, (3) it is no longer probable that the forecasted transaction will occur, or (4) we determine that designating the derivative as a hedging instrument is no longer appropriate. See Note 9 for additional discussion of our financial instruments.

Income Taxes—Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis using currently enacted income tax rates for the years in which the differences are expected to reverse. A valuation allowance (“VA”) is provided to offset any net deferred tax assets (“DTA(s)”) if, based upon the available evidence, it is more likely than not that some or all of the DTAs will not be realized. The realization of our net DTAs depends upon our ability to generate sufficient future taxable income of the appropriate character and in the appropriate jurisdictions.

Income tax and associated interest and penalty reserves, where applicable, are recorded in those instances where we consider it more likely than not that additional tax will be due in excess of amounts reflected in income tax returns filed worldwide, irrespective of whether or not we have received tax assessments. We continually review our exposure to additional income tax obligations and, as further information is known or events occur, changes in our tax and penalty reserves may be recorded within income tax expense and changes in interest reserves may be recorded in interest expense.

Partnering Arrangements—In the ordinary course of business, we execute specific projects and conduct certain operations through joint venture, consortium and other collaborative arrangements (collectively referred to as “venture(s)”). We have various ownership interests in these ventures, with such ownership typically proportionate to our decision making and distribution rights. The ventures generally contract directly with the third party customer; however, services may be performed directly by the ventures, or may be performed by us, our partners, or a combination thereof.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Venture net assets consist primarily of working capital and property and equipment, and assets may be restricted from being used to fund obligations outside of the venture. These ventures typically have limited third party debt or have debt that is non-recourse in nature; however, they may provide for capital calls to fund operations or require participants in the venture to provide additional financial support, including advance payment or retention letters of credit.

Each venture is assessed at inception and on an ongoing basis as to whether it qualifies as a VIE under the consolidations guidance in ASC 810. A venture generally qualifies as a VIE when it (1) meets the definition of a legal entity, (2) absorbs the operational risk of the projects being executed, creating a variable interest, and (3) lacks sufficient capital investment from the partners, potentially resulting in the venture requiring additional subordinated financial support, if necessary, to finance its future activities.

If at any time a venture qualifies as a VIE, we perform a qualitative assessment to determine whether we are the primary beneficiary of the VIE and, therefore, need to consolidate the VIE. We are the primary beneficiary if we have (1) the power to direct the economically significant activities of the VIE and (2) the right to receive benefits from, and obligation to absorb losses of, the VIE. If the venture is a VIE and we are the primary beneficiary, or we otherwise have the ability to control the venture, we consolidate the venture. If we are not determined to be the primary beneficiary of the VIE, or only have the ability to significantly influence, rather than control the venture, we do not consolidate the venture. We account for unconsolidated ventures using either proportionate consolidation for both the Balance Sheet and Statement of Operations, when we meet the applicable accounting criteria to do so, or utilize the equity method. See Note 7 for additional discussion of our material partnering arrangements.

New Accounting Standards—In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, which provides a single comprehensive accounting standard for revenue recognition for contracts with customers and supersedes current industry-specific guidance, including ASC 605-35. The new standard prescribes a five-step revenue recognition model that focuses on transfer of control and entitlement to payment when determining the amount of revenue to be recognized. The new model requires companies to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time for each of these obligations. These concepts, as well as other aspects of the ASU, may change the method and/or timing of revenue recognition for certain of our contracts, primarily associated with our fabrication and manufacturing contracts. We expect that revenue generated from our EPC and engineering services contracts will continue to be recognized over time utilizing the cost-to-cost measure of progress consistent with current practice. We also expect our revenue recognition disclosures to significantly expand due to the new qualitative and quantitative requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from our contracts. We will adopt the standard, including any updates to the standard, upon its effective date in the first quarter 2018 utilizing the modified retrospective approach. This approach will result in a cumulative adjustment to beginning equity in the first quarter 2018 for uncompleted contracts impacted by the adoption of the standard. We are continuing to assess the potential impact of the new standard on our Financial Statements.

In February 2016, the FASB issued ASU 2016-02, which requires the recognition of a right-of-use asset and a lease liability for most lease arrangements with a term greater than one year, and increases qualitative and quantitative disclosures regarding leasing transactions. The standard is effective for us in the first quarter 2019, although early adoption is permitted. Transition requires application of the new guidance at the beginning of the earliest comparative balance sheet period presented utilizing a modified retrospective approach. We are assessing the timing of adoption of the new standard and its potential impact on our Financial Statements.

In the first quarter 2017, we adopted ASU 2015-11, which simplifies the subsequent measurement of our inventory by requiring inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Our adoption of the standard did not have a material impact on our Financial Statements.

In the first quarter 2017, we adopted ASU 2016-09, which modified the accounting for excess tax benefits and tax deficiencies associated with share-based payments, amended the associated cash flow presentation, and allows for forfeitures to be either recognized when they occur, or estimated. ASU 2016-09 eliminated the requirement to recognize excess tax benefits in additional paid-in capital (“APIC”), and the requirement to evaluate tax deficiencies for APIC or income tax expense classification, and provided for these benefits or deficiencies to be recorded as an income tax expense or benefit in the Statement of Operations. Additionally, tax benefits of dividends on share-based payment awards are reflected as an income tax expense or benefit in the income statement. With these changes, tax-related cash flows resulting from share-based payments are classified as operating activities as opposed to financing, as previously presented. We have elected to recognize forfeitures as they occur, rather than estimating expected forfeitures. Our adoption of the standard did not have a material impact on our Financial Statements.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In the first quarter 2017, the FASB issued, and we early adopted, ASU 2017-04, which eliminated the second step of the goodwill impairment test that required a hypothetical purchase price allocation. ASU 2017-04 requires that if a reporting unit’s carrying value exceeds its fair value, an impairment charge would be recognized for the excess amount, not to exceed the carrying amount of goodwill. Our early adoption of the standard in the first quarter 2017 did not have a material impact on our Financial Statements.

3. EARNINGS PER SHARE

A reconciliation of weighted average basic shares outstanding to weighted average diluted shares outstanding and the computation of basic and diluted EPS are as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
Net (loss) income from continuing operations attributable to CB&I (net of $2,452, $8,272, $29,289 and $20,861 of noncontrolling interests)	$	(304,115	)	$	115,597	$	(288,541	)	$	216,931
Net (loss) income from discontinued operations attributable to CB&I (net of $457, $437, $870 and $885 of noncontrolling interests)	(121,304		)	8,242		(112,223		)	13,833
Net (loss) income attributable to CB&I	$	(425,419	)	$	123,839	$	(400,764	)	$	230,764
Weighted average shares outstanding—basic	100,866			105,298		100,660			105,051
Effect of restricted shares/performance based shares/stock options (1)	—			780		—			861
Effect of directors’ deferred-fee shares (1)	—			13		—			13
Weighted average shares outstanding—diluted	100,866			106,091		100,660			105,925
Net (loss) income attributable to CB&I per share (Basic):
Continuing operations	$	(3.02	)	$	1.10	$	(2.87	)	$	2.07
Discontinued operations	(1.20		)	0.08		(1.11		)	0.13
Total	$	(4.22	)	$	1.18	$	(3.98	)	$	2.20
Net (loss) income attributable to CB&I per share (Diluted):
Continuing operations	$	(3.02	)	$	1.09	$	(2.87	)	$	2.05
Discontinued operations	(1.20		)	0.08		(1.11		)	0.13
Total	$	(4.22	)	$	1.17	$	(3.98	)	$	2.18

⁽¹⁾ The effect of restricted shares, performance based shares, stock options and directors’ deferred-fee shares were not included in the calculation of diluted EPS for the three and six months ended June 30, 2017 due to the net loss for the periods. Antidilutive shares excluded from diluted EPS were not material for the three and six months ended June 30, 2016.

13

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

4. DISPOSITION OF CAPITAL SERVICES OPERATIONS

Transaction Summary— As discussed in Note 2, on February 27, 2017, we entered into the CS Agreement, which provided for the sale of our Capital Services Operations and completed the sale on June 30, 2017. Under the CS Agreement, the initial purchase price was $755,000, subject to certain adjustments, including a working capital adjustment, whereby the purchase price would be adjusted to the extent actual working capital of the Capital Services Operations on the Closing Date differed from required working capital under the CS Agreement. Prior to the Closing Date, the CS Agreement was amended to, among other things, reduce the purchase price to $700,000. As a result, and after giving effect to working capital and other adjustments estimated prior to the Closing Date of approximately $32,600, we received cash proceeds of approximately $667,400 (approximately $645,500 net of cash sold) on the Closing Date. In addition, based on actual working capital of the Capital Services Operations on the Closing Date, we accrued our estimate of the final post-closing working capital adjustment within other current liabilities on our June 30, 2017 Balance Sheet, to be paid during the fourth quarter 2017. Accordingly, we estimate that our final net proceeds will be approximately $599,000, including approximately $46,500 for transaction costs and the aforementioned post-closing working capital adjustment. As a result of the aforementioned, during the three and six months ended June 30, 2017, we recorded a pre-tax charge of approximately $64,800, and income tax expense of approximately $61,000 resulting from a taxable gain on the transaction (due primarily to the non-deductibility of goodwill). The transaction will not result in any material cash taxes associated with the taxable gain due to the use of previously recorded net operating loss carryforwards. The proceeds received on the Closing Date were used to reduce our outstanding debt.

Assets and Liabilities—The carrying values of the major classes of assets and liabilities of the discontinued Capital Services Operations included within our Balance Sheet on December 31, 2016 were as follows:

	December 31, 2016
Assets
Cash	$	14,477
Accounts receivable, net	239,146
Costs and estimated earnings in excess of billings	153,275
Other assets	7,834
Current assets of discontinued operations	414,732
Property and equipment, net	59,746
Goodwill (1)	229,607
Other intangibles, net	148,440
Other assets	24,351
Non-current assets of discontinued operations	462,144
Total assets of discontinued operations	$	876,876
Liabilities
Accounts payable	$	141,028
Billings in excess of costs and estimated earnings	53,986
Other liabilities	52,455
Current liabilities of discontinued operations	247,469
Other liabilities	5,388
Non-current liabilities of discontinued operations	5,388
Total liabilities of discontinued operations	$	252,857
Noncontrolling interests of discontinued operations	$	6,874

⁽¹⁾  The carrying value of goodwill for the Capital Services Operations includes the impact of a $655,000 impairment charge recorded in the fourth quarter 2016 in connection with our annual impairment assessment.

14

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Results of Operations—The results of our Capital Services Operations which have been reflected within discontinued operations in our Statement of Operations for the three and six months ended June 30, 2017 and 2016 were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Revenue	$	561,708		$	559,690		$	1,114,655		$	1,124,671
Cost of revenue	528,927			523,119			1,047,614			1,056,065
Gross profit	32,781			36,571			67,041			68,606
Selling and administrative expense	16,503			13,536			29,541			25,187
Intangibles amortization	—			4,030			2,550			8,230
Loss on net assets sold	64,817			—			64,817			—
Other operating expense (income)	876			120			504			(304		)
Operating (loss) income from discontinued operations	(49,415		)	18,885			(30,371		)	35,493
Interest expense (1)	(6,577		)	(5,877		)	(13,440		)	(11,710		)
Interest income	7			305			16			614
(Loss) income from discontinued operations before taxes	(55,985		)	13,313			(43,795		)	24,397
Income tax expense (2)	(64,862		)	(4,634		)	(67,558		)	(9,679		)
Net (loss) income from discontinued operations	(120,847		)	8,679			(111,353		)	14,718
Net income from discontinued operations attributable to noncontrolling interests	(457		)	(437		)	(870		)	(885		)
Net (loss) income from discontinued operations attributable to CB&I	$	(121,304	)	$	8,242		$	(112,223	)	$	13,833

⁽¹⁾ Interest expense was allocated to the Capital Services Operations due to a requirement to use the proceeds of the transaction to repay our debt. Proceeds from the transaction were initially used to repay our revolving facility borrowings as of June 30, 2017. The revolving facility was subsequently utilized to repay a portion of our senior notes in July 2017, as described in Note 8. The allocation of interest expense was based upon the debt amounts to be repaid.

⁽²⁾ As noted above, the transaction resulted in a taxable gain (due primarily to the non-deductibility of goodwill) resulting in additional tax expense of approximately $61,000 during the three and six months ended June 30, 2017.

Cash Flows—Cash flows for our Capital Services Operations for the six months ended June 30, 2017 and 2016 were as follows:

	Six Months Ended June 30,
	2017			2016
Operating cash flows	$	(36,469	)	$	28,470
Investing cash flows	$	(1,459	)	$	(2,495	)

5. INVENTORY

The components of inventory at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017		December 31, 2016
Raw materials	$	97,231	$	65,969
Work in process	28,717		51,625
Finished goods	32,870		72,508
Total	$	158,818	$	190,102

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

6. GOODWILL AND OTHER INTANGIBLES

Goodwill—At June 30, 2017 and December 31, 2016, our goodwill balances were $2,829,214 and $2,813,803, respectively, attributable to the excess of the purchase price over the fair value of net assets acquired in connection with our acquisitions. The change in goodwill for the six months ended June 30, 2017 is as follows:

	Total
Balance at December 31, 2016	$	2,813,803
Foreign currency translation and other	16,596
Amortization of tax goodwill in excess of book goodwill	(1,185		)
Balance at June 30, 2017 (1)	$	2,829,214

⁽¹⁾  At June 30, 2017, we had approximately $453,100 of cumulative impairment losses which were recorded in our Engineering & Construction operating group during 2015 related to the sale of our nuclear power construction business (our “Nuclear Operations”) on December 31, 2015.

As discussed further in Note 2, goodwill is not amortized to earnings, but instead is reviewed for impairment at least annually at a reporting unit level, absent any indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based upon balances as of October 1. At December 31, 2016, we had the following three operating groups and reporting units:

• Engineering & Construction—Our Engineering & Construction operating group represented a reporting unit.

• Fabrication Services—Our Fabrication Services operating group represented a reporting unit.

• Technology—Our Technology operating group represented a reporting unit.

During the three months ended December 31, 2016, we performed a quantitative assessment of goodwill for each of the aforementioned reporting units. Based upon these quantitative assessments, the fair value of each of these reporting units substantially exceeded their respective net book values, and accordingly, no impairment charge was necessary as a result of our impairment assessments. During the three months ended June 30, 2017, we experienced a decline in our market capitalization and incurred charges on certain projects (as discussed further in Note 14) within our Engineering & Construction reporting unit that resulted in a net loss for the three and six months ended June 30, 2017. We believe these events and circumstances were indicators that goodwill of our Engineering & Construction reporting unit was potentially impaired. Accordingly, we performed a quantitative assessment of goodwill for our Engineering & Construction reporting unit as of June 30, 2017. Based on this quantitative assessment, the fair value of the Engineering & Construction reporting unit continued to substantially exceed its net book value, and accordingly, no impairment charge was necessary as a result of our interim impairment assessment. If we were to experience an additional decline in our market capitalization, or a prolonged market capitalization at our current levels, it could indicate that the goodwill of our reporting units is impaired, and require additional interim quantitative impairment assessments. If, based on future assessments our goodwill is deemed to be impaired, the impairment would result in a charge to earnings in the period of impairment. There can be no assurance that future goodwill impairment tests will not result in charges to earnings. See Note 4 for discussion of our goodwill impairment for the Capital Services Operations recorded in the fourth quarter 2016 in connection with our annual impairment assessment.

Other Intangible Assets—The following table presents our acquired finite-lived intangible assets at June 30, 2017 and December 31, 2016, including the June 30, 2017 weighted-average useful lives for each major intangible asset class and in total:

		June 30, 2017					December 31, 2016
	Weighted Average Life	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Backlog and customer relationships	18 Years	$	99,086	$	(24,143	)	$	99,086	$	(21,374	)
Process technologies	15 Years	263,043		(140,717		)	258,516		(129,261		)
Tradenames	12 Years	27,327		(16,208		)	27,090		(14,648		)
Total (1)	16 Years	$	389,456	$	(181,068	)	$	384,692	$	(165,283	)

⁽¹⁾  The decrease in other intangibles, net during the six months ended June 30, 2017 primarily related to amortization expense of approximately $12,900.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

7. PARTNERING ARRANGEMENTS

As discussed in Note 2, we account for our unconsolidated ventures using either proportionate consolidation, when we meet the applicable accounting criteria to do so, or the equity method. Further, we consolidate any venture that is determined to be a VIE for which we are the primary beneficiary, or which we otherwise effectively control.

Proportionately Consolidated Ventures—The following is a summary description of our significant joint ventures whichhave been accounted for using proportionate consolidation:

• CB&I/Zachry—We have a venture with Zachry (CB&I—50% / Zachry—50%) to perform EPC work for two liquefied natural gas (“LNG”) liquefaction trains in Freeport, Texas. Our proportionate share of the venture project value is approximately $2,700,000. In addition, we have subcontract and risk sharing arrangements with Chiyoda to support our responsibilities to the venture. The costs of these arrangements are recorded in cost of revenue.

• CB&I/Zachry/Chiyoda—We have a venture with Zachry and Chiyoda (CB&I—33.3% / Zachry—33.3% / Chiyoda—33.3%) to perform EPC work for an additional LNG liquefaction train at the aforementioned project site in Freeport, Texas. Our proportionate share of the venture project value is approximately $675,000.

• CB&I/Chiyoda—We have a venture with Chiyoda (CB&I—50% / Chiyoda—50%) to perform EPC work for three LNG liquefaction trains in Hackberry, Louisiana. Our proportionate share of the venture project value is approximately $3,200,000.

The following table presents summarized balance sheet information for our share of our proportionately consolidated ventures at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
CB&I/Zachry
Current assets (1)	$	251,237	$	260,934
Non-current assets	2,678		3,204
Total assets	$	253,915	$	264,138
Current liabilities (1)	$	387,466	$	379,339
CB&I/Zachry/Chiyoda
Current assets (1)	$	88,593	$	84,279
Non-current assets	1,539		1,969
Total assets	$	90,132	$	86,248
Current liabilities (1)	$	68,305	$	73,138
CB&I/Chiyoda
Current assets (1)	$	186,278	$	337,479
Current liabilities (1)	$	258,367	$	150,179

⁽¹⁾  Our venture arrangements allow for excess working capital of the ventures to be advanced to the venture partners. Such advances are returned to the ventures for working capital needs as necessary. Accordingly, at a reporting period end a venture may have advances to its partners which are reflected as an advance receivable within current assets of the venture. At June 30, 2017 and December 31, 2016, other current assets on the Balance Sheet included approximately $324,400 and $374,800, respectively, related to our proportionate share of advances from the ventures to our venture partners, and other current liabilities included approximately $347,300 and $394,400, respectively, related to advances to CB&I from the ventures.

Equity Method Ventures—The following is a summary description of our significant joint ventures which have been accounted for using the equity method:

• Chevron-Lummus Global (“CLG”)—We have a venture with Chevron (CB&I—50% / Chevron—50%) which provides proprietary process technology licenses and associated engineering services and catalyst, primarily for the refining industry. As sufficient capital investments in CLG have been made by the venture partners, it does not qualify as a VIE.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

• NET Power—We have a venture with Exelon and 8 Rivers Capital (CB&I—33.3% / Exelon—33.3% / 8 Rivers Capital—33.3%) to commercialize a new natural gas power generation system that recovers the carbon dioxide produced during combustion. NET Power is building a first-of-its-kind demonstration plant which is being funded by contributions and services from the venture partners and other parties. We have determined the venture to be a VIE; however, we do not effectively control NET Power and therefore do not consolidate it. Our cash commitment for NET Power totals $47,300 and at June 30, 2017, we had made cumulative investments totaling approximately $44,900.

• CB&I/CTCI—We have a venture with CTCI (CB&I—50% / CTCI—50%) to perform EPC work for a liquids ethylene cracker and associated units in Sohar, Oman. We have determined the venture to be a VIE; however, we do not effectively control the venture and therefore do not consolidate it. Our proportionate share of the venture project value is approximately $1,400,000. Our venture arrangement allows for excess working capital of the venture to be advanced to the venture partners. Such advances are returned to the venture for working capital needs as necessary. At June 30, 2017 and December 31, 2016, other current liabilities included approximately $205,900 and $147,000, respectively, related to advances to CB&I from the venture.

Consolidated Ventures—The following is a summary description of our significant joint ventures we consolidate due to their designation as VIEs for which we are the primary beneficiary:

• CB&I/Kentz—We have a venture with Kentz (CB&I—65% / Kentz—35%) to perform the structural, mechanical, piping, electrical and instrumentation work on, and to provide commissioning support for, three LNG trains, including associated utilities and a gas processing and compression plant, for the Gorgon LNG project, located on Barrow Island, Australia. Our venture project value is approximately $5,900,000 and the project was substantially complete at June 30, 2017.

• CB&I/AREVA—We have a venture with AREVA (CB&I—52% / AREVA—48%) to design, license and construct a mixed oxide fuel fabrication facility in Aiken, South Carolina. Our venture project value is approximately $5,800,000.

The following table presents summarized balance sheet information for our consolidated ventures at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
CB&I/Kentz
Current assets	$	26,486	$	68,867
Non-current assets	69,404		—
Total assets	$	95,890	$	68,867
Current liabilities	$	27,581	$	87,822
CB&I/AREVA
Current assets	$	24,416	$	16,313
Current liabilities	$	50,086	$	47,652
All Other (1)
Current assets	$	33,099	$	69,785
Non-current assets	16,003		16,382
Total assets	$	49,102	$	86,167
Current liabilities	$	8,514	$	7,748

⁽¹⁾  Other ventures that we consolidate are not individually material to our financial results and are therefore aggregated as “All Other”.

Other—The use of these ventures exposes us to a number of risks, including the risk that our partners may be unable or unwilling to provide their share of capital investment to fund the operations of the venture or complete their obligations to us, the venture, or ultimately, our customer. Differences in opinions or views among venture partners could also result in delayed decision-making or failure to agree on material issues, which could adversely affect the business and operations of the venture. In addition, agreement terms may subject us to joint and several liability for our venture partners, and the failure of our venture partners to perform their obligations could impose additional performance and financial obligations on us. The aforementioned factors could result in unanticipated costs to complete the projects, liquidated damages or contract disputes, including claims against our partners.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

l8. DEBT

Our outstanding debt at June 30, 2017 and December 31, 2016 was as follows:

	June 30, 2017			December 31, 2016
Current
Revolving facility and other short-term borrowings	$	374,000		$	407,500
Current maturities of long-term debt	1,481,250			506,250
Less: unamortized debt issuance costs	(11,930		)	(2,340		)
Current maturities of long-term debt, net of unamortized debt issuance costs	1,469,320			503,910
Current debt, net of unamortized debt issuance costs	$	1,843,320		$	911,410
Long-Term
Term Loan: $1,000,000 term loan (interest at LIBOR plus a floating margin)	$	—		$	300,000
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)	481,250			500,000
Senior Notes: $800,000 senior notes, series A-D (fixed interest ranging from 4.65% to 5.80%)	800,000			800,000
Second Senior Notes: $200,000 senior notes (fixed interest of 5.03%)	200,000			200,000
Less: unamortized debt issuance costs	—			(5,827		)
Less: current maturities of long-term debt	(1,481,250		)	(506,250		)
Long-term debt, net of unamortized debt issuance costs	$	—		$	1,287,923

Committed Facilities—We have a five-year, $1,150,000 committed revolving credit facility (the “Revolving Facility”) with Bank of America N.A. (“BofA”), as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole Corporate and Investment Bank (“Credit Agricole”) and TD Securities, each as syndication agents, which expires in October 2018. The Revolving Facility had a $230,000 financial letter of credit sublimit at June 30, 2017. However, as a result of the amendments described below, effective August 9, 2017, the financial letter of credit sublimit was replaced with a $100,000 total letter of credit sublimit. At June 30, 2017, we had $204,000 and $67,211 of outstanding borrowings and letters of credit (none of which were financial letters of credit) under the facility, respectively, providing $878,789 of available capacity, of which $32,789 was available for letters of credit based on our new total letter of credit sublimit.

We also have a five-year, $800,000 committed revolving credit facility (the “Second Revolving Facility”) with BofA, as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole and Bank of Tokyo Mitsubishi UFJ, each as syndication agents, which expires in July 2020. The Second Revolving Facility supplements our Revolving Facility, and had a $50,000 financial letter of credit sublimit at June 30, 2017. However, as a result of the amendments described below, effective August 9, 2017, the financial letter of credit sublimit was replaced with a $100,000 total letter of credit sublimit. At June 30, 2017, we had $170,000 and $72,445 of outstanding borrowings and letters of credit (including $2,757 of financial letters of credit) under the facility, respectively, providing $557,555 of available capacity, of which $27,555 was available for letters of credit based on our new total letter of credit sublimit.

During the six months ended June 30, 2017, maximum outstanding borrowings under our Revolving Facility and Second Revolving Facility (together, “Committed Facilities”) were approximately $1,700,000. We are assessed quarterly commitment fees on the unutilized portion of the facilities as well as letter of credit fees on outstanding letters of credit. Through the date of the amendments described below, the interest, commitment fee, and letter of credit fee percentages were based on our quarterly leverage ratio and interest on borrowings under the facilities was assessed at either prime plus an applicable floating margin (4.25% and 1.50%, respectively at June 30, 2017), or LIBOR plus an applicable floating margin (1.23% and 2.50%, respectively at June 30, 2017). However, as a result of the amendments, effective August 9, 2017, interest on borrowings under the amended facilities will be assessed at either prime plus 4.00% or LIBOR plus 5.00%. In addition, our fees for financial and performance letters of credit will be 5.00% and 3.50%, respectively. During the six months ended June 30, 2017, our weighted average interest rate on borrowings under the Revolving Facility and Second Revolving Facility was approximately 3.3% and 4.9%, respectively, inclusive of the applicable floating margin. The Committed Facilities have financial and restrictive covenants described further below.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Uncommitted Facilities—We also have various short-term, uncommitted letter of credit facilities (the “Uncommitted Facilities”) across several geographic regions, under which we had $1,624,089 of outstanding letters of credit as of June 30, 2017.

Term Loans—On February 13, 2017, we paid the remaining $300,000 of principal on our four-year, $1,000,000 unsecured term loan (the “Term Loan”) with BofA as administrative agent. Interest was based upon LIBOR plus an applicable floating margin for the period (0.98% and 2.25%, respectively). In conjunction with the repayment of the Term Loan, we also settled our associated interest rate swap that hedged against a portion of the Term Loan, which resulted in a weighted average interest rate of approximately 2.6% during the first quarter 2017.

At June 30, 2017, we had $481,250 outstanding under a five-year, $500,000 term loan (the “Second Term Loan”) with BofA as administrative agent. Interest and principal under the Second Term Loan is payable quarterly in arrears beginning in June 2017, and through the date of the amendments described below, bore interest at LIBOR plus an applicable floating margin (1.23% and 2.50%, respectively at June 30, 2017). However, as a result of the amendments, effective August 9, 2017, interest will be assessed at either prime plus 4.00% or LIBOR plus 5.00%. During the six months ended June 30, 2017, our weighted average interest rate on the Second Term Loan was approximately 3.1%, inclusive of the applicable floating margin. Future annual maturities for the Second Term Loan are $37,500, $75,000, $75,000 and $293,750 for 2017, 2018, 2019, and 2020, respectively. The Second Term Loan has financial and restrictive covenants described further below.

Senior Notes—We have a series of senior notes totaling $800,000 in aggregate principal amount outstanding as of June 30, 2017 (the “Senior Notes”). The Senior Notes include Series A through D and contained the following terms at June 30, 2017:

• Series A—Interest due semi-annually at a fixed rate of 4.65%, with principal of $150,000 due in December 2017

• Series B—Interest due semi-annually at a fixed rate of 5.07%, with principal of $225,000 due in December 2019

• Series C—Interest due semi-annually at a fixed rate of 5.65%, with principal of $275,000 due in December 2022

• Series D—Interest due semi-annually at a fixed rate of 5.80%, with principal of $150,000 due in December 2024

On July 28, 2017, we utilized $211,800 of the proceeds from the sale of the Capital Services Operations to repay a portion of each series of senior notes in the following amounts: (Series A - $44,600, Series B - $58,200, Series C - $78,500 and Series D - $30,500). The repayment dates for the remaining principal amounts remained the same.    

We also have senior notes totaling $200,000 in aggregate principal amount outstanding as of June 30, 2017 (the “Second Senior Notes”) with BofA as administrative agent. At June 30, 2017, interest was due semi-annually at a fixed rate of 5.03%, with principal of $200,000 due in July 2025. On July 28, 2017, we utilized $57,100 of the proceeds from the sale of the Capital Services Operations to repay a portion of the Second Senior Notes. The repayment date for the remaining principal amount remained the same.

The Senior Notes and Second Senior Notes (together, the “Notes”) have financial and restrictive covenants described further below. Further, as a result of the amendments described below, our fixed interest rate on the amended Notes was increased by an incremental 2.50% over the rates in effect immediately prior to such amendments. The amended Notes also include provisions relating to our credit profile, which if not maintained will result in an incremental annual cost of up to 1.50% of the outstanding balance under the Notes. Further, the Notes include provisions relating to our leverage, which if not maintained, could result in an incremental annual cost of up to 1.00% (or 0.50% depending on our leverage level) of the outstanding balance under the Notes, provided that the incremental annual cost related to our credit profile and leverage cannot exceed 2.00% per annum. Finally, the Notes are subject to a make-whole premium in connection with certain prepayment events.

Compliance and Other—On February 24, 2017, and effective for the period ended December 31, 2016, we amended our Revolving Facility, Second Revolving Facility, and Second Term Loan (collectively, “Bank Facilities”) and Notes (collectively, with Bank Facilities, “Senior Facilities”). The amendments:

• Established a new maximum leverage ratio of 3.50 at December 31, 2016, decreasing to 3.00 at December 31, 2017, or 45 days subsequent to the closing of the sale of our Capital Services Operations (the “Closing Date”), if earlier.

• Established a new minimum net worth of $1,201,507, maintained our required fixed charge coverage ratio at 1.75, and reduced our Revolving Facility from $1,350,000 to $1,150,000 at the Closing Date.

• Included other financial and restrictive covenants, including restrictions regarding subsidiary indebtedness, sales of assets, liens, investments, type of business conducted, and mergers and acquisitions, and restrictions on dividend payments and share repurchases, among other restrictions.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

On May 8, 2017, and effective for the period ended March 31, 2017, we further amended our Senior Facilities. The amendments:

• Required us to secure the Senior Facilities through the pledge of cash, accounts receivable, inventory, fixed assets, and stock of subsidiaries, which was in the process of being completed as of June 30, 2017.

• Required us to repay portions of the Senior Facilities with all of the net proceeds from the sale of our Capital Services Operations, the issuance of any unsecured debt that is subordinate (“Subordinated Debt”) to the Senior Facilities, the issuance of any equity securities, or the sale of any assets.

• Established new maximum leverage ratios for borrowings under the Senior Facilities as follows: 4.00 at March 31, 2017; 4.50 at June 30, 2017 and September 30, 2017; 3.00 at December 31, 2017 and March 31, 2018; and 2.50 at June 30, 2018.

• Established total maximum leverage ratios (in addition to those established for the Senior Facilities) for all borrowings among the Senior Facilities and any Subordinated Debt as follows: 5.25 at June 30, 2017; 6.00 at September 30, 2017; 4.00 at December 31, 2017 and March 31, 2018; 3.25 at June 30, 2018; and 3.00 at September 30, 2018.

• Prohibited mergers and acquisitions, open-market share repurchases, and increases to dividends until our leverage ratio is below 3.00 for two consecutive quarters.

As a result of the project impacts in the second quarter 2017 (discussed further in Note 14), as of June 30, 2017, we would not have been in compliance with the previously amended financial covenants for our Senior Facilities, without certain waivers and amendments. Accordingly, effective August 9, 2017 (the “Effective Date”), and effective for the period ended June 30, 2017, we are further amending our Senior Facilities. The amendments, which are subject to final documentation, waive our noncompliance with our existing covenants as of June 30, 2017 and certain other defaults and events of default. In addition, the amendments:

• Eliminate our Minimum Net Worth covenant required by our previous amendments.

• Require minimum levels of trailing 12-month earnings before interest, taxes, depreciation and amortization (“EBITDA”), as defined by the amendments, as follows: $500,000 at September 30, 2017; $550,000 at December 31, 2017; $500,000 at March 31, 2018; $450,000 at June 30, 2018 and September 30, 2018; and $425,000 at December 31, 2018 and thereafter (“Minimum EBITDA”). Trailing 12-month EBITDA for purposes of determining compliance with the Minimum EBITDA covenant will be adjusted to exclude: an agreed amount attributable to any restructuring or integration charges during the third and fourth quarters of 2017; an agreed amount attributable to previous charges on certain projects which occurred during the first and second quarters of 2017; and an agreed amount for potential future charges for the same projects if they were to be incurred during the third and fourth quarters of 2017 (collectively, the “EBITDA Addbacks”).

• Provide for the replacement of our previous maximum leverage ratio and minimum fixed charge ratio with a new maximum leverage ratio of 1.75 (“Maximum Leverage Ratio”) and new minimum fixed charge coverage ratio of 2.25 (“Minimum Fixed Charge Coverage Ratio”), which are temporarily suspended and will resume as of March 31, 2018. Trailing 12-month EBITDA for purposes of determining compliance with the Maximum Leverage Ratio and consolidated net income for purposes of determining compliance with the Minimum Fixed Charge Coverage Ratio will be adjusted for the EBITDA Addbacks.

• Require us to execute on our plan to market and sell our Technology Operations by December 27, 2017 (the “Technology Sale”), with an extension of up to 60 days at the discretion of the holders of a majority of the outstanding Notes and at the discretion of the administrative agents of the Bank Facilities.

• Require us to maintain a minimum aggregate availability under our Revolving Facility and Second Revolving Facility, including borrowings and letters of credit, of $150,000 at all times from the Effective Date through the date of the Technology Sale, and $250,000 thereafter (“Minimum Availability”). Our amendments require the net cash proceeds from the Technology Sale be used to repay our Senior Facilities (“Mandatory Repayment Amount”). Further, our aggregate capacity under the Revolving Facility and Second Revolving Facility will be reduced by seventy percent (70%) of the portion of the Mandatory Repayment Amount allocable to the Revolving Facility and Second Revolving Facility, upon closing the Technology Sale and certain other mandatory prepayment events.

• Limit the amount of certain of our funded indebtedness to $3,000,000 prior to the Technology Sale and $2,900,000 thereafter, in each case, subject to reduction pursuant to scheduled repayments and mandatory prepayments thereof (but, with respect to the Revolving Facility and Second Revolving Facility, only to the extent the commitments have been reduced by such prepayments) made by us after the Effective Date.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

• Prohibit mergers and acquisitions, open-market share repurchases and dividend payments and certain inter-company transactions.

• Replace the previous financial letter of credit sublimits for our Revolving Facility and Second Revolving Facility with a $100,000 letter of credit sublimit for each, as described further above.

• Adjust the interest rates on our Senior Facilities, as described further above.

As discussed above, our amended covenants require, among other things, the completion of our plan to sell the Technology Operations. Further, we are required to comply with various new restrictive and financial covenants, including the Minimum EBITDA and Minimum Availability covenants. Although we received temporary suspension of our Maximum Leverage Ratio and Minimum Fixed Charge Coverage Ratio, these covenants will resume effective March 31, 2018. Based on our forecasted EBITDA and cash flows, we project that future compliance with certain covenants subsequent to December 31, 2017 will require the completion of the Technology Sale and associated net proceeds consistent with our expectations. Accordingly, debt of approximately $1,200,000, which by its terms is due beyond one year and would otherwise be shown as long-term, has been classified as current, as certain factors regarding our compliance with such covenants is beyond our control.

In addition to providing letters of credit, we also issue surety bonds in the ordinary course of business to support our contract performance. At June 30, 2017, we had $358,739 of outstanding surety bonds in support of our projects. In addition, we had $473,194 of surety bonds maintained on behalf of our former Capital Services Operations, for which we have received an indemnity from CSVC. We also continue to maintain guarantees on behalf of our former Capital Services Operations in support of approximately $166,000 of backlog, for which we have also received an indemnity.

Capitalized interest was insignificant for the six months ended June 30, 2017 and 2016.

9. FINANCIAL INSTRUMENTS

Derivatives

Foreign Currency Exchange Rate Derivatives—At June 30, 2017, the notional value of our outstanding forward contracts to hedge certain foreign exchange-related operating exposures was approximately $139,600. These contracts vary in duration, maturing up to five years from period-end. We designate certain of these hedges as cash flow hedges and accordingly, changes in their fair value are recognized in AOCI until the associated underlying operating exposure impacts our earnings. Forward points, which are deemed to be an ineffective portion of the hedges, are recognized within cost of revenue and are not material.

Financial Instruments Disclosures

Fair Value—Financial instruments are required to be categorized within a valuation hierarchy based upon the lowest level of input that is significant to the fair value measurement. The three levels of the valuation hierarchy are as follows:

• Level 1—Fair value is based upon quoted prices in active markets.

• Level 2—Fair value is based upon internally-developed models that use, as their basis, readily observable market parameters. Our derivative positions are classified within level 2 of the valuation hierarchy as they are valued using quoted market prices for similar assets and liabilities in active markets. These level 2 derivatives are valued utilizing an income approach, which discounts future cash flow based upon current market expectations and adjusts for credit risk.

• Level 3—Fair value is based upon internally-developed models that use, as their basis, significant unobservable market parameters. We did not have any level 3 classifications at June 30, 2017 or December 31, 2016.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table presents the fair value of our foreign currency exchange rate derivatives and interest rate derivatives at June 30, 2017 and December 31, 2016, respectively, by valuation hierarchy and balance sheet classification:

	June 30, 2017										December 31, 2016
	Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3		Total
Derivative Assets (1)
Other current assets	$	—	$	4,766		$	—	$	4,766		$	—	$	1,146		$	—	$	1,146
Other non-current assets	—		561			—		561			—		82			—		82
Total assets at fair value	$	—	$	5,327		$	—	$	5,327		$	—	$	1,228		$	—	$	1,228
Derivative Liabilities
Other current liabilities	$	—	$	(551	)	$	—	$	(551	)	$	—	$	(3,509	)	$	—	$	(3,509	)
Other non-current liabilities	—		(908		)	—		(908		)	—		(725		)	—		(725		)
Total liabilities at fair value	$	—	$	(1,459	)	$	—	$	(1,459	)	$	—	$	(4,234	)	$	—	$	(4,234	)

⁽¹⁾  We are exposed to credit risk on our hedging instruments associated with potential counterparty non-performance, and the fair value of our derivatives reflects this credit risk. The total level 2 assets at fair value above represent the maximum loss that we would incur on our outstanding hedges if the applicable counterparties failed to perform according to the hedge contracts. To help mitigate counterparty credit risk, we transact only with counterparties that are rated as investment grade or higher and monitor all counterparties on a continuous basis.

The carrying values of our cash and cash equivalents (primarily consisting of bank deposits), accounts receivable and accounts payable approximate their fair values because of the short-term nature of these instruments. At June 30, 2017, the fair value of our Second Term Loan, based upon the current market rates for debt with similar credit risk and maturities, approximated its carrying value as interest is based upon LIBOR plus an applicable floating margin. At June 30, 2017, the fair values of our Senior Notes and Second Senior Notes, based upon the current market rates for debt with similar credit risk and maturities, approximated their carrying values due to their classification as current on our Balance Sheet. At December 31, 2016, our Senior Notes and Second Senior Notes had a total fair value of approximately $785,700 and $206,400, respectively, based on current market rates for debt with similar credit risk and maturities and were categorized within level 2 of the valuation hierarchy.

Derivatives Disclosures

Fair Value—The following table presents the total fair value by underlying risk and balance sheet classification for derivatives designated as cash flow hedges and derivatives not designated as cash flow hedges at June 30, 2017 and December 31, 2016:

	Other Current and Non-Current Assets				Other Current and Non-Current Liabilities
	June 30, 2017		December 31, 2016		June 30, 2017			December 31, 2016
Derivatives designated as cash flow hedges
Interest rate	$	—	$	49	$	—		$	—
Foreign currency	545		109		—			(536		)
Fair value	$	545	$	158	$	—		$	(536	)
Derivatives not designated as cash flow hedges
Foreign currency	$	4,782	$	1,070	$	(1,459	)	$	(3,698	)
Fair value	$	4,782	$	1,070	$	(1,459	)	$	(3,698	)
Total fair value	$	5,327	$	1,228	$	(1,459	)	$	(4,234	)

23

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Master Netting Arrangements (“MNAs”)—Our derivatives are executed under International Swaps and Derivatives Association MNAs, which generally allow us and our counterparties to net settle, in a single net payable or receivable, obligations due on the same day, in the same currency and for the same type of derivative instrument. We have elected the option to record all derivatives on a gross basis in our Balance Sheet. The following table presents our derivative assets and liabilities at June 30, 2017 on a gross basis and a net settlement basis:

	Gross Amounts Recognized (i)			Gross Amounts Offset on the Balance Sheet (ii)		Net Amounts Presented on the Balance Sheet (iii) = (i) - (ii)			Gross Amounts Not Offset on the Balance Sheet (iv)					Net Amount (v) = (iii) - (iv)
									Financial Instruments			Cash Collateral Received
Derivative Assets
Foreign currency	5,327			—		5,327			(179		)	—		5,148
Total assets	$	5,327		$	—	$	5,327		$	(179	)	$	—	$	5,148
Derivative Liabilities
Foreign currency	(1,459		)	—		(1,459		)	179			—		(1,280		)
Total liabilities	$	(1,459	)	$	—	$	(1,459	)	$	179		$	—	$	(1,280	)

AOCI/Other—The following table presents the total value, by underlying risk, recognized in other comprehensive income (“OCI”) and reclassified from AOCI to interest expense (interest rate derivatives) and cost of revenue (foreign currency derivatives) during the three and six months ended June 30, 2017 and 2016 for derivatives designated as cash flow hedges:

	Amount of Gain (Loss) on Effective Derivative Portion
	Recognized in OCI										Reclassified from AOCI into Earnings (1)
	Three Months Ended June 30,					Six Months Ended June 30,					Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017		2016			2017		2016			2017		2016
Derivatives designated as cash flow hedges
Interest rate	$	—	$	(248	)	$	—	$	(961	)	$	—	$	(163	)	$	49	$	(344	)
Foreign currency	497		(655		)	1,179		821			84		148			208		(914		)
Total	$	497	$	(903	)	$	1,179	$	(140	)	$	84	$	(15	)	$	257	$	(1,258	)

⁽¹⁾  Net unrealized gains totaling approximately $600 are anticipated to be reclassified from AOCI into earnings during the next 12 months due to settlement of the associated underlying obligations.

The following table presents the total value recognized in cost of revenue for the three and six months ended June 30, 2017 and 2016 for foreign currency derivatives not designated as cash flow hedges:

	Amount of Gain (Loss) Recognized in Earnings
	Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017			2016
Derivatives not designated as cash flow hedges
Foreign currency	$	5,774	$	(4,930	)	$	(396	)	$	(9,159	)
Total	$	5,774	$	(4,930	)	$	(396	)	$	(9,159	)

24

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

10. RETIREMENT BENEFITS

Our 2016 Annual Report disclosed anticipated 2017 defined benefit pension and other postretirement plan contributions of approximately $17,000 and $2,500, respectively. The following table provides updated contribution information for these plans at June 30, 2017:

	Pension Plans		Other Postretirement Plans
Contributions made through June 30, 2017	$	9,720	$	1,040
Contributions expected for the remainder of 2017	8,183		1,238
Total contributions expected for 2017	$	17,903	$	2,278

The following table provides a breakout of the components of net periodic benefit cost (income) associated with our defined benefit pension and other postretirement plans for the three and six months ended June 30, 2017 and 2016:

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Pension Plans
Service cost	$	2,871		$	2,384		$	5,653		$	4,711
Interest cost	4,737			5,975			9,328			11,893
Expected return on plan assets	(5,968		)	(6,821		)	(11,754		)	(13,617		)
Amortization of prior service credits	(156		)	(158		)	(306		)	(312		)
Recognized net actuarial losses	1,529			1,475			3,027			2,936
Settlement expense (1)	2,426			—			2,426			—
Net periodic benefit cost	$	5,439		$	2,855		$	8,374		$	5,611
Other Postretirement Plans
Service cost	$	171		$	176		$	342		$	352
Interest cost	342			341			684			681
Recognized net actuarial gains	(685		)	(841		)	(1,370		)	(1,681		)
Net periodic benefit income	$	(172	)	$	(324	)	$	(344	)	$	(648	)

⁽¹⁾  Net periodic benefit cost in 2017 was impacted by the settlement of our qualified Canadian pension plan in the second quarter 2017. The settlement resulted in the immediate recognition of previously unrecognized actuarial gains related to the plan that were previously included in AOCI.

11. COMMITMENTS AND CONTINGENCIES

General—We have been and may from time to time be named as a defendant in legal actions claiming damages in connection with engineering and construction projects, technology licenses, other services we provide, and other matters. These are typically claims that arise in the normal course of business, including employment-related claims and contractual disputes or claims for personal injury or property damages which occur in connection with services performed relating to project or construction sites. Contractual disputes normally involve claims relating to the timely completion of projects, performance of equipment or technologies, design or other engineering services or project construction services provided by us. We do not believe that any of our pending contractual, employment-related personal injury or property damage claims and disputes will have a material adverse effect on our results of operations, financial position or cash flow. See Note 14 for additional discussion of claims associated with our projects.

Project Arbitration Matter—The customer for one of our large cost-reimbursable projects has filed a request for arbitration with the International Chamber of Commerce, alleging cost overruns on the project, which has been completed. The customer has not provided evidence to substantiate its allegations, and we believe all amounts incurred and billed on the project, including outstanding receivables of approximately $236,000 as of June 30, 2017, are contractually due under the provisions of our contract and are recoverable, but have been classified as a non-current asset on our Balance Sheet as we do not anticipate collection within the next year. We do not believe a risk of material loss is probable related to this matter, and accordingly, no amounts have been accrued. While it is possible that a loss may be incurred, we are unable to estimate the range of potential loss, if any. Further, we have asserted counterclaims for our outstanding receivables.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Dispute Related to Sale of Nuclear Operations—On December 31, 2015, we sold our Nuclear Operations to Westinghouse Electric Company LLC (“WEC”). In connection with the transaction, a post-closing purchase price adjustment mechanism was negotiated between CB&I and WEC to account for any difference between target working capital and actual working capital as finally determined pursuant to the terms of the purchase agreement. On April 28, 2016, WEC delivered to us a purported closing statement that estimated closing working capital was negative$976,506, which was $2,150,506 less than the target working capital amount. In contrast, we calculated closing working capital to be $1,601,805, which was $427,805 greater than the target working capital amount. On July 21, 2016, we filed a complaint against WEC in the Court of Chancery in the State of Delaware seeking a declaration that WEC has no remedy for the vast majority of its claims, and we requested an injunction barring WEC from bringing such claims. On December 2, 2016, the Court of Chancery granted WEC’s motion for judgment on the pleadings and dismissed our complaint, stating that the dispute should follow the dispute resolution process set forth in the purchase agreement, which includes the use of an independent auditor to resolve the working capital dispute. We appealed that ruling to the Delaware Supreme Court. Due to WEC’s bankruptcy filing on March 29, 2017, all claim resolution proceedings were automatically stayed pursuant to the Bankruptcy Code. At the parties’ request, the Bankruptcy Court lifted the automatic stay to permit the appeal and dispute resolution process to continue. Oral argument before the Delaware Supreme Court was held on May 3, 2017, and on June 27, 2017, the Delaware Supreme Court overturned the decision of the Court of Chancery and instructed the Court of Chancery to issue an order enjoining WEC from submitting certain claims to the independent auditor. The parties continue to move forward with those matters still subject to the dispute resolution process and with the selection of a new independent auditor to replace the previous auditor, who had resigned. We do not believe a risk of material loss is probable related to this matter, and, accordingly, no amounts have been accrued. While it is possible that a loss may be incurred, we are unable to estimate the range of potential loss, if any. We believe the Delaware Supreme Court ruling significantly improved our position on this matter and intend to continue pursuing our rights under the purchase agreement.

Asbestos Litigation—We are a defendant in numerous lawsuits wherein plaintiffs allege exposure to asbestos due to work we may have performed at various locations. We have never been a manufacturer, distributor or supplier of asbestos products. Over the past several decades and through June 30, 2017, we have been named a defendant in lawsuits alleging exposure to asbestos involving approximately 6,100 plaintiffs and, of those claims, approximately 1,200 claims were pending and 4,900 have been closed through dismissals or settlements. Over the past several decades and through June 30, 2017, the claims alleging exposure to asbestos that have been resolved have been dismissed or settled for an average settlement amount of approximately two thousand dollars per claim. We review each case on its own merits and make accruals based on the probability of loss and our estimates of the amount of liability and related expenses, if any. Although we have seen an increase in the number of recent filings, especially in one specific venue, we do not believe the increase or any unresolved asserted claims will have a material adverse effect on our future results of operations, financial position or cash flow, and at June 30, 2017, we had approximately $8,300 accrued for liability and related expenses. With respect to unasserted asbestos claims, we cannot identify a population of potential claimants with sufficient certainty to determine the probability of a loss and to make a reasonable estimate of liability, if any. While we continue to pursue recovery for recognized and unrecognized contingent losses through insurance, indemnification arrangements or other sources, we are unable to quantify the amount, if any, that we may expect to recover because of the variability in coverage amounts, limitations and deductibles or the viability of carriers, with respect to our insurance policies for the years in question.

Environmental Matters—Our operations are subject to extensive and changing U.S. federal, state and local laws and regulations, as well as the laws of other countries, that establish health and environmental quality standards. These standards, among others, relate to air and water pollutants and the management and disposal of hazardous substances and wastes. We are exposed to potential liability for personal injury or property damage caused by any release, spill, exposure or other accident involving such pollutants, substances or wastes.

In connection with the historical operation of our facilities, including those associated with acquired operations, substances which currently are or might be considered hazardous were used or disposed of at some sites that will or may require us to make expenditures for remediation. In addition, we have agreed to indemnify parties from whom we have purchased or to whom we have sold facilities for certain environmental liabilities arising from acts occurring before the dates those facilities were transferred.

We believe we are in compliance, in all material respects, with environmental laws and regulations and maintain insurance coverage to mitigate our exposure to environmental liabilities. We do not believe any environmental matters will have a material adverse effect on our future results of operations, financial position or cash flow. We do not anticipate we will incur material capital expenditures for environmental controls or for the investigation or remediation of environmental conditions during the remainder of 2017 or 2018.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

12. ACCUMULATED OTHER COMPREHENSIVE INCOME

The following table presents changes in AOCI, net of tax, by component, during the six months ended June 30, 2017:

	Currency Translation Adjustment (1)			Unrealized Fair Value Of Cash Flow Hedges			Defined Benefit Pension and Other Postretirement Plans			Total
Balance at December 31, 2016	$	(264,562	)	$	(213	)	$	(130,841	)	$	(395,616	)
OCI before reclassifications	55,973			942			(10,924		)	45,991
Amounts reclassified from AOCI	—			(132		)	2,859			2,727
Net OCI	55,973			810			(8,065		)	48,718
Balance at June 30, 2017	$	(208,589	)	$	597		$	(138,906	)	$	(346,898	)

⁽¹⁾  During the six months ended June 30, 2017, the currency translation adjustment component of AOCI was favorably impacted by net movements in the Australian Dollar, British Pound, and Euro exchange rates against the U.S. Dollar.

The following table presents reclassification of AOCI into earnings, net of tax, for each component, during the six months ended June 30, 2017:

	Amount Reclassified From AOCI
Unrealized Fair Value Of Cash Flow Hedges (1)
Interest rate derivatives (interest expense)	$	(49	)
Foreign currency derivatives (cost of revenue)	(208		)
Total before tax	$	(257	)
Tax	125
Total net of tax	$	(132	)
Defined Benefit Pension and Other Postretirement Plans (2)
Amortization of prior service credits	$	(306	)
Recognized net actuarial losses	4,155
Total before tax	$	3,849
Tax	(990		)
Total net of tax	$	2,859

⁽¹⁾  See Note 9 for further discussion of our cash flow hedges, including the total value reclassified from AOCI to earnings.

⁽²⁾  See Note 10 for further discussion of our defined benefit and other postretirement plans, including the components of net periodic benefit cost.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

13. EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY

General—Under our equity-based incentive plans (our “Incentive Plans”), we can issue shares to employees and directors in the form of restricted stock units (“RSUs”), performance based shares (including those based upon financial or stock price performance) and stock options. Changes in common stock, APIC and treasury stock during the six months ended June 30, 2017 and 2016 primarily relate to activity associated with our Incentive Plans and share repurchases.

Share Grants—During the six months ended June 30, 2017, we had the following share grants associated with our Incentive Plans:

	Shares (1)	Weighted Average Grant-Date Fair Value per Share
RSUs	1,155	$	32.13
Financial performance based shares	597	$	36.00
Stock performance based shares	149	$	44.21
Total shares granted	1,901

⁽¹⁾  No stock options were granted during the six months ended June 30, 2017.

Share Issuances—During the six months ended June 30, 2017, we had the following share issuances associated with our Incentive Plans and employee stock purchase plan (“ESPP”):

	Shares
Financial performance based shares (issued upon vesting)	49
RSUs (issued upon vesting)	867
Stock options (issued upon exercise)	32
ESPP shares (issued upon sale)	239
Total shares issued	1,187

Stock-Based Compensation Expense—During the three months ended June 30, 2017 and 2016, we recognized $16,194 and $6,658, respectively (including $6,198 and $718, respectively, associated with our discontinued Capital Services Operations), of stock-based compensation expense, and during the six months ended June 30, 2017 and 2016, we recognized $26,441 and $21,158, respectively (including $6,874 and $1,640, respectively, associated with our discontinued Capital Services Operations), of stock-based compensation expense, primarily within selling and administrative expense. We recognize forfeitures as they occur, rather than estimating expected forfeitures.

Share Repurchases—During the six months ended June 30, 2017, we repurchased 299 shares for $9,080 (an average price of $30.37) for taxes withheld on taxable share distributions.

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

14. UNAPPROVED CHANGE ORDERS, CLAIMS, INCENTIVES AND OTHER PROJECT MATTERS

Unapproved Change Orders, Claims and Incentives—We have unapproved change orders and claims (collectively, “Claims”) and incentives included in project price for consolidated and proportionately consolidated projects within our Engineering & Construction and Fabrication Services operating groups.

At June 30, 2017 and December 31, 2016, our pro-rata share of Claims included in project price totaled approximately $520,000 and $121,100, respectively. Our Claims at June 30, 2017 are primarily related to a completed project, a consolidated joint venture project that is substantially complete, and a proportionately consolidated joint venture project. The Claims are primarily associated with schedule related delays and related prolongation costs, fabrication activities and disputes regarding certain reimbursable billings. Approximately $266,200 of the Claim amounts are subject to arbitration or dispute resolution proceedings that are in the early stages and the remainder are subject to early commercial discussions. Further, approximately $456,000 of the Claim amounts had been recognized as revenue on a cumulative POC basis through June 30, 2017. Of the recognized Claim amounts at June 30, 2017, approximately $154,000 had been paid by the respective customers, approximately $39,000 has been reflected within non-current assets on our Balance Sheet as we do not anticipate collection within the next year, and the remainder has been reflected within cost and estimated earnings in excess of billings on our Balance Sheet.

At June 30, 2017 and December 31, 2016, we also had incentives included in project price of approximately $38,200 and $43,000, respectively, for projects within our Engineering & Construction and Fabrication Services operating groups. Approximately $21,300 of such amounts had been recognized as revenue on a cumulative POC basis through June 30, 2017.

The aforementioned amounts recorded in project price and recognized as revenue reflect our best estimate of recovery amounts; however, the ultimate resolution and amounts received could differ from these estimates and could have a material adverse effect on our results of operations, financial position and cash flow. See Note 11 for further discussion of outstanding receivables related to one of our completed large cost-reimbursable projects.

Westinghouse Bankruptcy—At June 30, 2017, we had approximately $31,000 of accounts receivable and unbilled amounts due from Westinghouse. On March 29, 2017, Westinghouse filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code (“Westinghouse Bankruptcy”). We currently do not believe the Westinghouse Bankruptcy will impact the realizability of the receivable amounts and therefore, no amounts have been reserved as of June 30, 2017.

Other—Backlog for each of our operating groups generally consists of several hundred contracts and our results may be impacted by changes in estimated project margins. For the three months ended June 30, 2017, significant changes in estimated margins on four projects resulted in a decrease to our income from operations of approximately $548,000, all within our Engineering & Construction operating group. For the six months ended June 30, 2017, significant changes in estimated margins on the same four projects resulted in a decrease to our income from operations of approximately $715,000, and changes in estimated margins on two projects resulted in an increase to our income from operations of approximately $103,000, all within our Engineering & Construction operating group. For the three and six months ended June 30, 2016, individual projects with significant changes in estimated margins did not have a material net impact on our income from operations.

The two projects that resulted in an increase to our income from operations of approximately $103,000 for the six months ended June 30, 2017, benefited from changes in estimated recoveries during the three months ended March 31, 2017, and included a large consolidated joint venture project and a separate cost reimbursable project.

Loss Projects

Two of the projects that resulted in a decrease to our income from operations for the 2017 periods were in a loss position. For the three and six months ended June 30, 2017, changes in estimates on these projects resulted in a decrease to our income from operations of approximately $181,000 and $324,000, respectively. The loss projects were impacted primarily by lower than anticipated craft labor productivity (including reductions to our forecasted productivity estimates to levels that are in line with our overall historical experience); slower than anticipated benefits from mitigation plans; and further extensions of schedule and related prolongation costs (including schedule liquidated damages) resulting from the aforementioned impacts. At June 30, 2017, one project was approximately 69% complete, had a reserve for estimated losses of approximately $98,000, and is forecasted to be completed in May 2018 (representing a four month extension from our estimates as of March 31, 2017). The other loss project was approximately 86% complete, had a reserve for estimated losses of approximately $23,000, and is forecasted to be completed in November 2017 (representing a two month extension from our estimates as of March 31, 2017). If future direct and subcontract labor productivity differ from our current estimates, our schedules are further extended, or the projects incur increased schedule liquidated damages due to our inability to reach favorable commercial resolution on such matters, the projects would experience further losses.

29

Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Proportionately Consolidated JV Projects

The two other projects that resulted in a decrease to our income from operations for the 2017 periods were proportionately consolidated joint venture projects. For the three and six months ended June 30, 2017, changes in estimates on these projects resulted in a decrease to our income from operations of approximately $367,000 and $391,000, respectively.

A majority of the impacts for the 2017 period relate to one of the proportionately consolidated joint venture projects, which was slightly above break-even at June 30, 2017. The project was impacted primarily by lower than anticipated craft labor productivity (including reductions to our forecasted productivity estimates as trending results of certain disciplines provided increased evidence that previously forecasted productivity estimates were unlikely to be achieved); weather related delays; increased material, construction and fabrication costs due to quantity growth and material delivery delays; higher than anticipated estimates from subcontractors for their work scopes; and extensions of schedule and related prolongation costs resulting from the aforementioned. The revised schedule represented a several month extension from our March 31, 2017 estimates for certain LNG trains and the schedule was submitted to the owner during the three months ended June 30, 2017. Our current forecast for the project anticipates improvement in productivity from our overall historical experience (as we make progress on each LNG train) through modified execution plans, and actions to reduce our schedule related costs. The aforementioned impact for the six months ended June 30, 2017 includes the benefit of an increase in project price for claims on the project during the three months ended March 31, 2017.

The remaining impacts for the 2017 period relate to the other proportionately consolidated joint venture project, which was impacted primarily by increased material, construction and fabrication costs due to quantity growth and material delivery delays, and potential extensions of schedule and related prolongation costs resulting from the aforementioned.

If future direct and subcontract labor productivity differ from our current estimates, our schedules are further extended, or the projects incur schedule liquidated damages due to our inability to reach favorable legal or commercial resolution on such matters, the projects would experience further decreases in estimated margins.

15. SEGMENT INFORMATION

Our management structure and internal and public segment reporting are aligned based upon the services offered by our three operating groups, which represent our reportable segments: Engineering & Construction; Fabrication Services; and Technology. Our chief operating decision maker evaluates the performance of the aforementioned operating groups based upon revenue and income from operations. Each operating group’s income from operations reflects corporate costs, allocated based primarily upon revenue. Intersegment revenue for our continuing operations is netted against the revenue of the segment receiving the intersegment services. For the three months ended June 30, 2017 and 2016, intersegment revenue totaled approximately $152,700 and $66,700, respectively, and for the six months ended June 30, 2017 and 2016, intersegment revenue totaled approximately $294,100 and $107,600, respectively. Intersegment revenue for the aforementioned periods primarily related to services provided by our Fabrication Services operating group to our Engineering & Construction operating group.

As a result of the classification of our Capital Services Operations (which was primarily comprised of our former Capital Services reportable segment) as a discontinued operation, the 2016 information for our remaining segments presented below has been recast to reflect: 1) a reallocation of certain corporate amounts previously allocated to the Capital Services segment that were not assignable to the discontinued operation, and 2) the portions of the previously reported Capital Services segment that were not included in the Capital Services Operations and the portions of other segments that were included in the Capital Services Operations. In addition, revenue for the remaining segments has been recast to reflect the intersegment revenue with our Capital Services Operations that was previously eliminated prior to the discontinued operations classification (approximately $18,500 and $25,200 for the three months ended June 30, 2017 and 2016, respectively, and approximately $34,400 and $57,100 for the six months ended June 30, 2017 and 2016, respectively).

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Chicago Bridge & Iron Company N.V.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table presents total revenue and income from operations by reportable segment for the three and six months ended June 30, 2017 and 2016:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
Revenue
Engineering & Construction	$	702,150		$	1,548,994	$	1,982,903		$	3,085,355
Fabrication Services	508,518			547,658		987,090			1,081,364
Technology	72,809			64,512		140,836			129,074
Total revenue	$	1,283,477		$	2,161,164	$	3,110,829		$	4,295,793
Operating (Loss) Income From Continuing Operations
Engineering & Construction	$	(525,682	)	$	92,809	$	(520,268	)	$	200,882
Fabrication Services	57,639			67,385		109,698			104,495
Technology	21,460			23,054		42,975			49,203
Total operating (loss) income from continuing operations	$	(446,583	)	$	183,248	$	(367,595	)	$	354,580

The following table presents total assets by reportable segment at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Assets
Engineering & Construction	$	3,694,396	$	3,572,399
Fabrication Services	2,465,398		2,394,041
Technology	986,485		996,104
Total assets of continuing operations	7,146,279		6,962,544
Assets of discontinued operations (Note 4)	—		876,876
Total assets	$	7,146,279	$	7,839,420

16. SUBSEQUENT EVENT

Amendments to Debt and Credit Facility Agreements—Effective August 9, 2017, and effective for the period ended June 30, 2017, we are amending our Senior Facilities, subject to final documentation. See Note 8 for additional discussion.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations” is provided to assist readers in understanding our financial performance during the periods presented and significant trends that may impact our future performance. This discussion should be read in conjunction with our Financial Statements and the related notes thereto.

OVERVIEW

General—We provide a wide range of services through our three operating groups, including conceptual design, technology, engineering, procurement, fabrication, modularization, construction and commissioning services to customers in the energy infrastructure market throughout the world. Our operating groups, which represent our reportable segments, include: Engineering & Construction; Fabrication Services; and Technology. Our Capital Services Operations (primarily comprised of our former Capital Services reportable segment), which provides comprehensive and integrated maintenance services, environmental engineering and remediation, construction services, program management, and disaster response and recovery services for private-sector customers and governments, was sold on June 30, 2017 and is reported as a discontinued operation (see Note 2 and Note 4 to our Financial Statements for further discussion).

We continue to be broadly diversified across the global energy infrastructure market with a backlog of $13.6 billion at June 30, 2017 (including approximately $1.5 billion related to our equity method joint ventures). Our geographic diversity is illustrated by approximately 25% of our year-to-date 2017 revenue coming from projects outside the U.S. and approximately 25% of our June 30, 2017 backlog being comprised of projects outside the U.S. The geographic mix of our revenue will evolve consistent with changes in our backlog mix, as well as shifts in future global energy demand. Our diversity in energy infrastructure end markets ranges from downstream activities such as gas processing, liquefied natural gas (“LNG”), refining, and petrochemicals, to fossil based power plants and upstream activities such as offshore oil and gas and onshore oil sands projects. Planned investments across the natural gas value chain, including LNG and petrochemicals, remain strong over the intermediate to long term, and we anticipate additional benefits from continued investments in projects based on U.S. shale gas. Global investments in power and petrochemical facilities are expected to continue, as are investments in various types of facilities which require storage structures and pre-fabricated pipe.

Our long-term contracts are awarded on a competitively bid and negotiated basis using a range of contracting options, including cost-reimbursable, fixed-price and hybrid, which has both cost-reimbursable and fixed-price characteristics. Under cost-reimbursable contracts, we generally perform our services in exchange for a price that consists of reimbursement of all customer-approved costs and a profit component, which is typically a fixed rate per hour, an overall fixed fee or a percentage of total reimbursable costs. Under fixed-price contracts, we perform our services and execute our projects at an established price. The timing of our revenue recognition may be impacted by the contracting structure of our contracts. Cost-reimbursable contracts, and hybrid contracts with a more significant cost-reimbursable component, generally provide our customers with greater influence over the timing of when we perform our work, and accordingly, such contracts often result in less predictability with respect to the timing of our revenue. Fixed-price contracts, and hybrid contracts with a more significant fixed-price component, tend to provide us with greater control over project schedule and the timing of when work is performed and costs are incurred, and accordingly, when revenue is recognized. Our shorter-term contracts and services are generally provided on a cost-reimbursable, fixed-price or unit price basis. Our June 30, 2017 backlog distribution by contracting type was approximately 85% fixed-price, hybrid, or unit based, and 15% cost-reimbursable and is further described below within our operating group discussion.

New awards represent the expected revenue value of new contract commitments received during a given period, as well as scope growth on existing commitments. Backlog represents the unearned value of our new awards. New awards and backlog include the entire award values for joint ventures we consolidate and our proportionate share of award values for joint ventures we proportionately consolidate. New awards and backlog also include our pro-rata share of the award values for unconsolidated joint ventures we account for under the equity method. As the net results for our equity method joint ventures are recognized as equity earnings, their revenue is not presented in our Condensed Consolidated Statement of Operations (“Statement of Operations”).

Backlog for each of our operating groups generally consists of several hundred contracts, which are being executed globally. These contracts vary in size from less than one hundred thousand dollars to several billion dollars in contract value, with varying durations that can exceed five years. The timing of new awards and differing types, sizes, and durations of our contracts, combined with their geographic diversity and stages of completion, often results in fluctuations in our quarterly operating group results as a percentage of operating group revenue. In addition, the relative contribution of each of our operating groups, and selling and administrative expense fluctuations, will impact our quarterly consolidated results as a percentage of consolidated revenue. Selling and administrative expense fluctuations are impacted by our stock-based compensation costs, which are generally higher in the first quarter of each year due to the timing of stock awards and the accelerated expensing of awards for participants who are eligible to retire.

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In addition to the quarterly variability that occurs in our business, our future quarterly consolidated operating results will be impacted by the sale of our Capital Services Operations, which closed on June 30, 2017 and is reported as a discontinued operation (see Note 2 and Note 4 to our Financial Statements for further discussion). In addition, as discussed below within “Results of Operations”, during the second quarter 2017 we experienced changes in estimated margins on our two U.S. LNG export facility projects and two of our U.S. gas turbine power projects within our Engineering & Construction operating group, which negatively impacted our second quarter results, and will result in future revenue on the projects being recognized at these lower margins until the backlog for such projects is completed. Further, in July 2017, we initiated a plan to market and sell our Technology operations (primarily comprised of our Technology reportable segment) and Engineered Products operations (representing a portion of our Fabrication Services reportable segment) (collectively, the “Technology Operations”), the proceeds of which will be used to significantly reduce our outstanding debt, discussed below within “Liquidity and Capital Resources”. We anticipate classifying the Technology Operations as held for sale during the third quarter 2017 and our future quarterly consolidated operating results will be impacted subsequent to the sale.

As a result of the project impacts in the second quarter 2017, we would not have been in compliance with our previously amended financial covenants for our Senior Facilities as of June 30, 3017, without certain waivers and amendments. Accordingly, effective August 9, 2017, and effective for the period ended June 30, 2017, we are amending our Senior Facilities, subject to final documentation. Such amendments impacted our debt classification at June 30, 2017. See “Liquidity and Capital Resources” below for further discussion.

Engineering & Construction—Our Engineering & Construction operating group provides engineering, procurement, and construction (“EPC”) services for major energy infrastructure facilities.

Backlog for our Engineering & Construction operating group comprised approximately $10.4 billion (77%) of our consolidated June 30, 2017 backlog (including approximately $1.0 billion related to our equity method joint ventures). The backlog composition by end market was approximately 40% petrochemical, 30% LNG, 25% power, and 5% refining. Our petrochemical backlog was primarily concentrated in the U.S. and the Middle East region and we anticipate that our future opportunities will continue to be derived from these regions. Our LNG backlog was primarily concentrated in the U.S. and we anticipate that our future opportunities will be derived from the U.S. and Africa. Our power backlog was primarily concentrated in the U.S. and we anticipate that our future opportunities will be derived from North America. The majority of our refining-related backlog was concentrated in the Middle East and Russia and we anticipate that our future opportunities will continue to be derived from these regions. Our June 30, 2017 backlog distribution for this operating group by contracting type was approximately 85% fixed-price and hybrid and 15% cost-reimbursable.

Fabrication Services—Our Fabrication Services operating group provides fabrication and erection of steel plate structures; fabrication of piping systems and process modules; manufacturing and distribution of pipe and fittings; and engineered products for the oil and gas, petrochemical, power generation, water and wastewater, mining and mineral processing industries.

Backlog for our Fabrication Services operating group comprised approximately $2.0 billion (15%) of our consolidated June 30, 2017 backlog. The backlog composition by end market was approximately 40% petrochemical, 30% LNG (including low temp and cryogenic), 15% power, 5% refining, 5% gas processing and 5% other end markets. Our June 30, 2017 backlog distribution for this operating group by contracting type was approximately 95% fixed-price, hybrid, or unit based, with the remainder being cost-reimbursable.

Technology—Our Technology operating group provides proprietary process technology licenses and associated engineering services and catalysts, primarily for the petrochemical and refining industries, and offers process planning and project development services and a comprehensive program of aftermarket support. Technology also has a 50% owned unconsolidated joint venture that provides proprietary process technology licenses and associated engineering services and catalysts, primarily for the refining industry, as well as a 33.3% owned unconsolidated joint venture that is commercializing a new natural gas power generation system that is designed to produce zero atmospheric discharge of carbon dioxide during combustion.

Backlog for our Technology operating group comprised approximately $1.2 billion (8%) of our consolidated June 30, 2017 backlog (including approximately $491.4 million related to our equity method joint ventures) and was primarily comprised of fixed-price contracts.

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RESULTS OF OPERATIONS

As a result of the classification of the operating results of our Capital Services Operations (which is primarily comprised of our former Capital Services reportable segment) as a discontinued operation, the results of our remaining segments for the 2016 periods presented have been recast to reflect: 1) a reallocation of certain corporate amounts previously allocated to the Capital Services segment that were not assignable to discontinued operations, and 2) the portions of the previously reported Capital Services segment that were not included in the Capital Services Operations and the portions of other segments that were included in the Capital Services Operations. In addition, backlog, new awards and revenue for the remaining segments has been recast in the tables below to reflect the intersegment amounts with our Capital Services Operations that were previously eliminated prior to the discontinued operations classification. Intersegment elimination adjustments include the following: 1) December 31, 2016 backlog of $6.5 million, 2) second quarter and year-to-date 2017 and 2016 new awards of $3.4 million, $20.3 million, $3.4 million and $37.8 million, respectively, and 3) second quarter and year-to-date 2017 and 2016 revenue of $18.5 million, $25.2 million, $34.4 million and $57.1 million, respectively. Unless otherwise noted, the tables and discussions below relate to our continuing operations.

Our backlog, new awards, revenue and income from operations by reportable segment are as follows:

	June 30, 2017				% of Total			December 31, 2016				% of Total
Backlog	(In thousands)
Engineering & Construction	$	10,445,699			77%			$	9,871,208			76%
Fabrication Services	2,001,355				15%			2,117,567				16%
Technology	1,160,453				8%			1,025,723				8%
Total backlog	$	13,607,507						$	13,014,498
	Three Months Ended June 30,							Six Months Ended June 30,
	(In thousands)
	2017			% of Total	2016		% of Total	2017			% of Total	2016		% of Total
New Awards
Engineering & Construction	$	398,421		37%	$	977,911	73%	$	2,634,594		67%	$	1,319,576	62%
Fabrication Services	521,447			49%	253,633		19%	967,707			25%	627,772		29%
Technology	148,507			14%	107,769		8%	308,861			8%	191,389		9%
Total new awards	$	1,068,375			$	1,339,313		$	3,911,162			$	2,138,737
	2017			% of Total	2016		% of Total	2017			% of Total	2016		% of Total
Revenue
Engineering & Construction	$	702,150		55%	$	1,548,994	72%	$	1,982,903		64%	$	3,085,355	72%
Fabrication Services	508,518			39%	547,658		25%	987,090			32%	1,081,364		25%
Technology	72,809			6%	64,512		3%	140,836			4%	129,074		3%
Total revenue	$	1,283,477			$	2,161,164		$	3,110,829			$	4,295,793
	2017			% of Revenue	2016		% of Revenue	2017			% of Revenue	2016		% of Revenue
Operating (Loss) Income From Continuing Operations
Engineering & Construction	$	(525,682	)	(74.9)%	$	92,809	6.0%	$	(520,268	)	(26.2)%	$	200,882	6.5%
Fabrication Services	57,639			11.3%	67,385		12.3%	109,698			11.1%	104,495		9.7%
Technology	21,460			29.5%	23,054		35.7%	42,975			30.5%	49,203		38.1%
Total operating (loss) income from continuing operations	$	(446,583	)	(34.8)%	$	183,248	8.5%	$	(367,595	)	(11.8)%	$	354,580	8.3%

Consolidated Results

New Awards/Backlog—As discussed above, new awards represent the expected revenue value of new contract commitments received during a given period, as well as scope growth on existing commitments. Backlog represents the unearned value of our new awards. New awards and backlog include the entire award values for joint ventures we consolidate and our proportionate share of award values for joint ventures we proportionately consolidate. New awards and backlog also include our pro-rata share of the award values for unconsolidated joint ventures we account for under the equity method. As the net results for our equity method joint ventures are recognized as equity earnings, their revenue is not presented in our

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Statement of Operations. Our new awards may vary significantly each reporting period based upon the timing of our major new contract commitments.

New awards were $1.1 billion for the second quarter 2017 (including approximately $12.0 million related to our equity method joint ventures), compared with $1.3 billion for the corresponding 2016 period (including approximately $37.0 million related to our equity method joint ventures). Significant new awards for the second quarter 2017 included LNG storage tanks in the U.S. (approximately $185.0 million), materials supply for an ethylene expansion project in the Asia Pacific region (approximately $85.0 million), and an ethane cracking furnace expansion project in the U.S. (approximately $40.0 million), all within our Fabrication Services operating group, and work scopes for our liquid ethylene cracker project and associated units in the Middle East that we are executing through our unconsolidated equity method joint venture (approximately $100.0 million) within our Engineering & Construction operating group. Significant new awards for the second quarter 2016 included two gas turbine power projects in the U.S. (approximately $500.0 million combined) and scope increases on our LNG mechanical erection project in the Asia Pacific region (approximately $280.0 million) within our Engineering & Construction operating group.

New awards for the first six months of2017 were $3.9 billion (including approximately $58.7 million related to our equity method joint ventures), compared with $2.1 billion for the corresponding 2016 period (including approximately $67.0 million related to our equity method joint ventures). The six month 2017 period included the aforementioned second quarter 2017 awards, and awards in the first quarter 2017, including an ethane cracker project in the U.S. (approximately $1.3 billion) within our Engineering & Construction and Fabrication Services operating groups and a gas turbine power project in the U.S. (approximately $600.0 million) within our Engineering & Construction operating group. The six month 2016 period included the aforementioned second quarter 2016 awards, and awards in the first quarter 2016, including scope increases on our LNG mechanical erection project in the Asia Pacific region (approximately $235.0 million) within our Engineering & Construction operating group. See Operating Group Results below for further discussion.

Backlog at June 30, 2017 was approximately $13.6 billion (including approximately $1.5 billion related to our equity method joint ventures), compared with $13.0 billion at December 31, 2016 (including approximately $1.7 billion related to our equity method joint ventures), with the increase primarily reflecting the impact of new awards exceeding revenue by $800.3 million (including $186.6 million of revenue for our unconsolidated equity method joint ventures).

Certain contracts within our Engineering & Construction operating group are dependent upon funding from the U.S. government, where funds are appropriated on a year-by-year basis, while contract performance may take more than one year. Approximately $225.0 million of our backlog at June 30, 2017 for the operating group was for contractual commitments that are subject to future funding decisions.

Revenue—Revenue was $1.3 billion for the second quarter 2017, representing a decrease of $877.7 million (40.6%) compared with the corresponding 2016 period. Revenue was $3.1 billion for the first six months of 2017, representing a decrease of $1.2 billion (27.6%) compared with the corresponding 2016 period. Our second quarter and year-to-date 2017 revenue was impacted by the reversal of revenue on our two U.S. LNG export facility projects resulting from a reduction in their percentage of completion due to increases in forecast costs on the projects, and the wind down of our large cost reimbursable LNG mechanical erection project in the Asia Pacific region and various projects in the Middle East, Europe and Asia Pacific region, all within our Engineering & Construction operating group. See Operating Group Results below for further discussion.

Gross (Loss) Profit—Gross loss was $(378.1) million (29.5% of revenue) for the second quarter 2017, compared with gross profit of $258.0 million (11.9% of revenue) for the corresponding 2016 period. Gross loss was $(227.1) million (7.3% of revenue) for the first six months of 2017, compared with gross profit of $513.5 million (12.0% of revenue) for the corresponding 2016 period. Our second quarter and year-to-date 2017 gross profit decreased relative to the comparable 2016 period due to lower revenue volume and a lower margin mix. In addition, our second quarter and year-to-date 2017 results were negatively impacted by changes in estimated margins on our two U.S. LNG export facility projects and two U.S. gas turbine power projects, all within our Engineering & Construction operating group. Our year-to-date 2017 gross profit also decreased relative to the comparable 2016 period due to the impacts of changes in estimated margins on certain projects and a lower margin mix during the first quarter 2017. See Operating Group Results below for further discussion.

Selling and Administrative Expense—Selling and administrative expense was $67.2 million (5.2% of revenue) for the second quarter 2017, compared with $69.2 million (3.2% of revenue) for the corresponding 2016 period. Selling and administrative expense was $140.2 million (4.5% of revenue) for the first six months of 2017, compared with $150.1 million (3.5% of revenue) for the corresponding 2016 period. The decrease for the second quarter and year-to-date 2017 was primarily due to the impact of cost reduction initiatives, partly offset by higher incentive plan costs (approximately $5.0 million and $2.0 million, respectively) and inflationary increases. Stock-based compensation expense totaled approximately $19.6 million and $19.5 million for the first six months of 2017 and 2016, respectively, or 57% and 57% of estimated annual expense for each of the respective periods.

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Intangibles Amortization—Intangibles amortization was $6.4 million for the second quarter2017, compared with $6.5 million for the corresponding 2016 period. Intangibles amortization was $12.9 million for the first six months of 2017, compared with $13.5 million for the corresponding 2016 period. The decrease relative to the year-to-date 2016 period was primarily due to intangible assets that became fully amortized during the first quarter 2016.

Equity Earnings—Equity earnings were $8.7 million for the second quarter2017, compared with $2.1 million for the corresponding 2016 period. Equity earnings were $16.3 million for the first six months of 2017, compared with $5.7 million for the corresponding 2016 period and were primarily associated with our unconsolidated CTCI and CLG joint ventures within our Engineering & Construction and Technology operating groups, respectively. Our second quarter and year-to-date 2017 equity earnings benefited from increased activity for our CTCI joint venture; however, this year-to-date benefit was partly offset by decreased activity for our CLG joint venture in the first quarter 2017.

Other Operating Expense (Income), Net—Other operating expense (income), net generally represents (gains) losses associated with the sale or disposition of property and equipment. For the second quarter and first six months of 2017, other operating expense (income), net also included accrued future operating lease expense of approximately $3.0 million for vacated facility capacity where we remain contractually obligated to a lessor.

(Loss) Income from Continuing Operations—Loss from continuing operations was $(446.6) million (34.8% of revenue) for the second quarter 2017, compared with income from continuing operations of $183.2 million (8.5% of revenue) for the corresponding 2016 period. Loss from continuing operations was $(367.6) million (11.8% of revenue) for the first six months of 2017, compared with income from continuing operations of $354.6 million (8.3% of revenue) for the corresponding 2016 period. The changes in our second quarter and year-to-date 2017 (loss) income from continuing operations compared to the 2016 periods were due to the reasons noted above. See Operating Group Results below for further discussion.

Interest Expense and Interest Income—Interest expense was $34.7 million for the second quarter 2017, compared with $20.2 million for the corresponding 2016 period. Interest expense was $58.8 million for the first six months of 2017, compared with $40.3 million for the corresponding 2016 period. Our second quarter and year-to-date 2017 expense was impacted by higher revolving credit facility borrowings and higher interest rates. Approximately $6.6 million and $13.4 million of interest expense for the second quarter and year-to-date 2017 periods, respectively, and approximately $5.9 million and $11.7 million, respectively, of interest for the corresponding 2016 periods, has been classified within discontinued operations as the proceeds from the sale of our discontinued Capital Services Operations were required to be used to repay our debt. Interest income was $0.9 million for the second quarter 2017, compared with $2.8 million for the corresponding 2016 period. Interest income was $2.1 million for the first six months of 2017, compared with $4.9 million for the corresponding 2016 period.

Income Tax Benefit (Expense)—Income tax benefit was $178.8 million (37.2% of pre-tax loss) for the second quarter 2017, compared with income tax expense of $41.9 million (25.3% of pre-tax income) for the corresponding 2016 period. Income tax benefit was $165.0 million (38.9% of pre-tax loss) for the first six months of 2017, compared with income tax expense of $81.5 million (25.5% of pre-tax income) for the corresponding 2016 period.

Our tax rate rates for second the quarter and year-to-date 2017 periods were impacted by our pre-tax losses for the periods occurring in our higher rate tax jurisdictions (the U.S.), and to a lesser extent, less pre-tax income in our lower rate tax jurisdictions (non-U.S). The pre-tax losses in the U.S. were generated from the aforementioned project charges. Our second quarter and year-to-date 2017 tax rates were also impacted by the establishment of valuation allowances in the second quarter 2017 for U.S. deferred tax credits and U.S. state net operating losses that are no longer anticipated to be realized (approximately 10.0% and 11.0% impact to our tax rates for the respective periods). Excluding the impact of the aforementioned valuation allowances, our second quarter and year-to-date 2017 tax rates were approximately 47.0% and 50.0%, respectively which resulted from the aforementioned pre-tax mix.

Our second quarter and year-to-date 2016 tax rate benefited from earnings represented by noncontrolling interests (approximately 1.5% and 3.5%, respectively) and the impact of previously unrecognized tax benefits (approximately 2.0% and 3.5%, respectively). The benefits for the year-to-date 2016 period were partly offset by the impact of changes in tax rates enacted during the first quarter relating to our non-U.S. deferred tax assets (approximately 2.0%).

Our tax rate may continue to experience fluctuations due primarily to changes in the geographic distribution of our pre-tax income. Based upon our current estimates of pre-tax income mix, we anticipate our tax rate for the second half of 2017 will be approximately 28.0% to 30.0%.

Net Income Attributable to Noncontrolling Interests—Noncontrolling interests are primarily associated with our consolidated joint venture projects within our Engineering & Construction operating group and certain operations in the Middle East within our Fabrication Services operating group. Net income attributable to noncontrolling interests was $2.9 million for the second quarter 2017, compared with $8.7 million for the corresponding 2016 period. Net income attributable to noncontrolling interests was $30.2 million for the first six months of 2017, compared with $21.7 million for the corresponding

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2016 period. The change compared to the 2016 periods was commensurate with the level of applicable operating results for the aforementioned projects and operations. See Operating Group Results below for further discussion.

Segment Results

Engineering & Construction

New Awards—New awards were $398.4 million for the second quarter 2017, compared with $977.9 million for the corresponding 2016 period. Significant new awards for the second quarter2017 included work scopes for our liquid ethylene cracker project and associated units in the Middle East that we are executing through our unconsolidated equity method joint venture (approximately $100.0 million). Significant new awards for the second quarter2016 included two gas turbine power projects in the U.S. (approximately $500.0 million combined) and scope increases on our LNG mechanical erection project in the Asia Pacific region (approximately $280.0 million).

New awards for the first six months of 2017 were $2.6 billion, compared with $1.3 billion for the corresponding 2016 period. The six month 2017 period included the aforementioned second quarter 2017 awards, and awards during the first quarter 2017, including an ethane cracker project in the U.S. (approximately $1.2 billion) and a gas turbine power project in the U.S. (approximately $600.0 million). The six month 2016 period included the aforementioned second quarter 2016 awards, and awards during the first quarter 2016, including scope increases on our LNG mechanical erection project in the Asia Pacific region (approximately $235.0 million).

Revenue—Revenue was $702.2 million for the second quarter 2017, representing a decrease of $846.8 million (54.7%) compared with the corresponding 2016 period. Revenue was $2.0 billion for the first six months of 2017, representing a decrease of $1.1 billion (35.7%) compared with the corresponding 2016 period. Our second quarter and year-to-date 2017 revenue was primarily impacted by the wind down of our large cost reimbursable LNG mechanical erection project in the Asia Pacific region (approximately $322.0 million and $519.0 million, respectively) and the wind down of various projects in the Middle East, Europe and Asia Pacific region; and lower revenue on our two U.S. LNG export facility projects (approximately $365.0 million and $255.0 million combined, respectively) resulting from the impact of reductions in their percentage of completion due to increases in forecast costs on the projects (see further discussion below), offset partly by greater activity on the projects during 2017.

Approximately $213.0 million and $845.0 million of the operating group’s second quarter and year-to-date 2017 revenue, respectively, was attributable to our U.S. LNG export facility projects, compared with approximately $578.0 million and $1.1 billion for the corresponding 2016 periods. Approximately $3.0 million and $110.0 million of the operating group’s second quarter and year-to-date 2017 revenue, respectively, was attributable to our large cost reimbursable LNG mechanical erection project in the Asia Pacific region, compared with approximately $325.0 million and $629.0 million for the corresponding 2016 periods.

(Loss) Income from Operations—Loss from operations was $(525.7) million (74.9% of revenue) for the second quarter 2017, compared with income from operations of $92.8 million (6.0% of revenue) for the corresponding 2016 period. Loss from operations was $(520.3) million (26.2% of revenue) for the first six months of 2017, compared with income from operations of $200.9 million (6.5% of revenue) for the corresponding 2016 period.

Our second quarter and year-to-date 2017 results were impacted by lower revenue volume and a lower margin mix. In addition, our results were impacted by changes in estimated margins on two U.S. gas turbine power projects and our two U.S. LNG export facility projects (approximately $548.0 million and $715.0 million, for the respective periods as discussed further below). The changes in estimated margins resulted in charges due to the accrual of additional losses for the U.S. gas turbine power projects resulting from increases in forecast costs on the projects, and the reversal of previously recognized revenue for the U.S. LNG export facility projects resulting from a reduction in their percentage of completion due to increases in forecast costs on the projects. Our results for the second quarter were also impacted by a lower margin percentage recognized on work performed during the period for the U.S. LNG export facility projects (approximately $50.0 million) as a result of the aforementioned changes in estimated margins.

The aforementioned negative impacts for the year-to-date 2017 period were partly offset by the benefit of changes in estimated recoveries in the first quarter 2017 on a large consolidated joint venture project and a separate cost reimbursable project (approximately $103.0 million combined). The second quarter and year-to-date 2017 periods also benefited from increased equity earnings from our unconsolidated CTCI joint venture (approximately $6.0 million and $12.5 million, respectively). Our second quarter and year-to-date 2016 results were impacted by changes in estimated margins on various projects, primarily in the U.S. (approximately $14.0 million combined).

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U.S. Gas Turbine Power Projects

Two of the projects that negatively impacted our second quarter and year-to-date 2017 results ($181.0 million and $324.0 million, respectively) were U.S. gas turbine power projects that were in a loss position. The loss projects were impacted primarily by lower than anticipated craft labor productivity (including reductions to our forecasted productivity estimates to levels that are in line with our overall historical experience); slower than anticipated benefits from mitigation plans; and further extensions of schedule and related prolongation costs (including schedule liquidated damages) resulting from the aforementioned impacts. At June 30, 2017, one project was approximately 69% complete, had a reserve for estimated losses of approximately $98.0 million, and is forecasted to be completed in May 2018 (representing a four month extension from our estimates as of March 31, 2017). The other loss project was approximately 86% complete, had a reserve for estimated losses of approximately $23.0 million, and is forecasted to be completed in November 2017 (representing a two month extension from our estimates as of March 31, 2017). If future direct and subcontract labor productivity differ from our current estimates, our schedules are further extended, or the projects incur increased schedule liquidated damages due to our inability to reach favorable commercial resolution on such matters, the projects would experience further losses. As these projects are in a loss position, future revenue on the projects will be recognized with no associated margin.

U.S. LNG Export Facility Projects

The two other projects that negatively impacted our second quarter and year-to-date 2017 results (approximately $367.0 million and $391.0 million, respectively) were U.S. LNG export facility projects.

A majority of the impacts relate to our project in Hackberry, Louisiana, which was slightly above break-even at June 30, 2017. The project was impacted primarily by lower than anticipated craft labor productivity (including reductions to our forecasted productivity estimates as trending results of certain disciplines provided increased evidence that previously forecasted productivity estimates were unlikely to be achieved); weather related delays; increased material, construction and fabrication costs due to quantity growth and material delivery delays; higher than anticipated estimates from subcontractors for their work scopes; and extensions of schedule and related prolongation costs resulting from the aforementioned. The revised schedule represented a several month extension from our March 31, 2017 estimates for certain LNG trains and the schedule was submitted to the owner during the second quarter 2017. Our current forecast for the project anticipates improvement in productivity from our overall historical experience (as we make progress on each LNG train) through modified execution plans, and actions to reduce our schedule related costs. The aforementioned impact for the year-to-date 2017 period includes the benefit of an increase in project price for claims on the project during the first quarter 2017.

The remaining impacts for the 2017 period relate to our project in Freeport, Texas, which was impacted primarily by increased material, construction and fabrication costs due to quantity growth and material delivery delays, and potential extensions of schedule and related prolongation costs resulting from the aforementioned.

If future direct and subcontract labor productivity differ from our current estimates, our schedules are further extended, or the projects incur schedule liquidated damages due to our inability to reach favorable legal or commercial resolution on such matters, the projects would experience further decreases in estimated margins. As these projects experienced a reduction in their estimated margins during the second quarter 2017, future revenue on the projects will be recognized at these lower margins.  

Fabrication Services

New Awards—New awards were $521.4 million for the second quarter 2017, compared with $253.6 million for the corresponding 2016 period. New awards for the second quarter 2017 included LNG storage tanks in the U.S. (approximately $185.0 million), materials supply for an ethylene expansion project in the Asia Pacific region ($85.0 million), an ethane cracking furnace expansion project in the U.S. (approximately $40.0 million), and various storage and pipe fabrication awards throughout the world. Significant new awards for the second quarter 2016 included various storage and pipe fabrication awards throughout the world.

New awards for the first six months of 2017 were $967.7 million, compared with $627.8 million for the corresponding 2016 period. The six month 2017 period included the aforementioned second quarter 2017 awards, and awards during the first quarter 2017, including work scopes we will perform for the aforementioned ethane cracker project in the U.S. (approximately $80.0 million) and various storage and pipe fabrication awards throughout the world. The six month 2016 period included the aforementioned second quarter 2016 awards, and awards during the first quarter 2016, including refurbishment of crude oil storage tanks in the Middle East (approximately $60.0 million) and crude oil storage tanks in Canada (approximately $50.0 million).

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Revenue—Revenue was $508.5 million for the second quarter 2017, representing a decrease of $39.1 million (7.1%) compared with the corresponding 2016 period. Revenue was $1.0 billion for the first six months of 2017, representing a decrease of $94.3 million (8.7%) compared with the corresponding 2016 period. Our second quarter and year-to-date 2017 revenue was primarily impacted by decreased storage tank work in the U.S., Canada and the Middle East and decreased process systems activity, partly offset by increased fabrication activity.

Income from Operations—Income from operations was $57.6 million (11.3% of revenue) for the second quarter 2017, compared with $67.4 million (12.3% of revenue) for the corresponding 2016 period. Income from operations was $109.7 million (11.1% of revenue) for the first six months of 2017, compared with $104.5 million (9.7% of revenue) for the corresponding 2016 period. Our second quarter and year-to-date 2017 results benefited from lower overhead costs. Our second quarter2016 results benefited from net savings on various projects throughout the world (approximately $11.0 million combined). Our year-to-date 2016 results benefited from the aforementioned second quarter impacts, as well as impacts during the first quarter 2016, which included cost increases on two projects in North America and the Asia Pacific region (approximately $26.0 million combined), partly offset by savings on various projects, primarily in North America.

Technology

New Awards—New awards were $148.5 million for the second quarter 2017 (including approximately $12.0 million related to our equity method joint ventures), compared with $107.8 million for the corresponding 2016 period (including approximately $37.0 million related to our equity method joint ventures). New awards were $308.9 million for the first six months of 2017 (including approximately $58.7 million related to our equity method joint ventures), compared with $191.4 million for the corresponding 2016 period (including approximately $67.0 million related to our equity method joint ventures). New awards for the second quarter and year-to-date 2017 included petrochemical and refining licensing, catalyst and proprietary equipment awards, primarily in the Asia Pacific region. New awards for the second quarter and year-to-date 2016 included Alkylation licensing in North America and China, petrochemical licensing in Europe and the Asia Pacific region, and catalyst awards throughout the world.

Revenue—Revenue was $72.8 million for the second quarter 2017, representing an increase of $8.3 million (12.9%) compared with the corresponding 2016 period. Revenue was $140.8 million for the first six months of 2017, representing an increase of $11.8 million (9.1%) compared with the corresponding 2016 period. Our second quarter and year-to-date 2017 revenue benefited from increased petrochemical licensing, partly offset by lower catalyst activity.

Income from Operations—Income from operations was $21.5 million (29.5% of revenue) for the second quarter 2017, compared with $23.1 million (35.7% of revenue) for the corresponding 2016 period. Income from operations was $43.0 million (30.5% of revenue) for the first six months of 2017, compared with $49.2 million (38.1% of revenue) for the corresponding 2016 period. Our second quarter and year-to-date 2017 results were impacted by a lower margin mix for our petrochemicals and refining projects.

Discontinued Capital Services Operations

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
	(In thousands)
New Awards	$	308,425		$	439,808		$	780,783		$	855,298
Revenue	$	561,708		$	559,690		$	1,114,655		$	1,124,671
(Loss) Income From Operations	$	(49,415	)	$	18,885		$	(30,371	)	$	35,493
% of Revenue	(8.8		)%	3.4		%	(2.7		)%	3.2		%

Our discontinued Capital Services Operations, which were sold on June 30, 2017, provided comprehensive and integrated maintenance services, environmental engineering and remediation, construction services, program management, and disaster response and recovery services for private-sector customers and governments.

Revenue—Revenue was $561.7 million for the second quarter 2017, representing an increase of $2.0 million (0.4%) compared with the corresponding 2016 period. Revenue was $1.1 billion for the first six months of 2017, representing a decrease of $10.0 million (0.9%) compared with the corresponding 2016 period. Our year-to-date 2017 revenue was impacted by lower construction services and industrial maintenance activity, partly offset by increased emergency response activity in the first quarter 2017.

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(Loss) Income from Operations—Loss from operations for the second quarter 2017 was $(49.4) million (8.8% of revenue), compared with income from operations of $18.9 million (3.4% of revenue) for the corresponding 2016 period. Loss from operations for the first six months of 2017 was $(30.4) million (2.7% of revenue), compared with income from operations of $35.5 million (3.2% of revenue) for the corresponding 2016 period. Our second quarter 2017 results were impacted by the completion of the sale of our Capital Services Operations which resulted in a pre-tax charge (approximately $64.8 million) and increased stock compensation costs (approximately $5.5 million) due to the accelerated expensing of employee awards as a result of the sale.

The sale of our Capital Services Operations resulted in a taxable gain (due primarily to the non-deductibility of goodwill), which resulted in additional tax expense of approximately $61.0 million for the second quarter and year-to-date 2017 periods.

LIQUIDITY AND CAPITAL RESOURCES

General

Cash and Cash Equivalents—At June 30, 2017, our cash and cash equivalents were $354.9 million, and were maintained in local accounts throughout the world, substantially all of which were maintained outside The Netherlands, our country of domicile. Approximately $188.4 million of our cash and cash equivalents at June 30, 2017 was within our variable interest entities (“VIEs”) associated with our partnering arrangements, which is generally only available for use in our operating activities when distributed to the partners.

With respect to tax consequences associated with repatriating our foreign earnings, distributions from our European Union (“EU”) subsidiaries to their Netherlands parent companies are not subject to taxation. Further, for our non-EU companies and their subsidiaries and our U.S. companies, to the extent taxes apply, the amount of permanently reinvested earnings becomes taxable upon repatriation of assets from the subsidiary or liquidation of the subsidiary. We have accrued taxes on undistributed earnings that we intend to repatriate and we intend to permanently reinvest the remaining undistributed earnings in their respective businesses, and accordingly, have accrued no taxes on such amounts.

Summary of Cash Flow Activity

Operating Activities—During the first six months of 2017, net cash used in operating activities was $466.1 million (including approximately $36.5 million related to our discontinued Capital Services Operations), primarily due to cash utilized as a result of net losses, a net increase of $42.5 million in our other current and non-current assets, and a reduction of $128.0 million in our other current and non-current liabilities, partly offset by a net change of $109.1 million in our accounts receivable, inventory, accounts payable and net contracts in progress account balances (collectively, “Contract Capital”). The components of our net Contract Capital balances at June 30, 2017 and December 31, 2016 (including our discontinued Capital Services Operations prior to its sale), and changes during the first six months of 2017, were as follows:

	June 30, 2017 (2)			December 31, 2016 (2)			Change
	(In thousands)
Total billings in excess of costs and estimated earnings (1)	$	(1,751,968	)	$	(1,449,335	)	$	(302,633	)
Total costs and estimated earnings in excess of billings (1)	567,980			564,024			3,956
Contracts in Progress, net	(1,183,988		)	(885,311		)	(298,677		)
Accounts receivable, net	892,314			727,659			164,655
Inventory	161,142			194,130			(32,988		)
Accounts payable	(1,047,663		)	(1,105,576		)	57,913
Contract Capital, net	$	(1,178,195	)	$	(1,069,098	)	$	(109,097	)

⁽¹⁾  Represents our cash position relative to revenue recognized on projects, with (i) billings in excess of costs and estimated earnings representing a liability reflective of future cash expenditures and non-cash earnings and (ii) costs and estimated earnings in excess of billings representing an asset reflective of future cash receipts.

⁽²⁾  Although our Capital Services Operations were sold on June 30, 2017 and reported as a discontinued operation in our December 31, 2016 Balance Sheet, our Statement of Cash Flows reflects the changes in Contract Capital balances (and all balance sheet components) during the first six months of 2017 prior to the sale and on a non-discontinued operations basis at December 31, 2016. Accordingly, the components of our net Contract Capital balances prior to their removal on June 30, 2017, and on a non-discontinued operations basis at December 31, 2016, have been reflected in the table above.

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Fluctuations in our Contract Capital balance, and its components, are not unusual in our business and are impacted by the size of our projects and changing mix of cost-reimbursable versus fixed-price backlog. Our cost-reimbursable projects tend to have a greater working capital requirement (“costs and estimated earnings in excess of billings”), while our fixed-price projects are generally structured to be cash flow positive (“billings in excess of costs and estimated earnings”). Our Contract Capital is particularly impacted by the timing of new awards and related payments in advance of performing work, and the achievement of billing milestones on backlog as we complete certain phases of work. Contract Capital is also impacted at period-end by the timing of accounts receivable collections and accounts payable payments for our large projects.

The $109.1 million decrease in our Contract Capital during the first six months of 2017 (including an increase of approximately $61.8 million related to our discontinued Capital Services Operations) was primarily due to a net decrease in contracts in progress and accounts receivable, partly offset by a decrease in accounts payable. The net decrease in contracts in progress during the period was primarily due to the accrual of additional losses for two U.S. gas turbine power projects resulting from increases in forecast costs on the projects, and the reversal of revenue on our two U.S. LNG export facility projects resulting from a reduction in their percentage of completion due to increases in forecast costs on the projects, partly offset by a net use of advance payments on these projects. The decrease in accounts payable during the period was due to the timing of payments on our projects. The net increase in our current and other non-current assets during the period was primarily due to a change in the classification of receivables from accounts receivable, net, to other non-current assets, for a consolidated joint venture project that is substantially complete, as we do not anticipate collection within the next year. The decrease in our other current and non-current liabilities during the period was primarily due to payments resulting from the wind down of certain projects in the Asia Pacific region. Our net cash used in operating activities, combined with payments in advance of performing work for our unconsolidated equity method joint ventures, which are reflected in financing activities because the joint ventures are not consolidated, totaled approximately $407.2 million during the first six months of 2017. We anticipate future quarterly variability in our operating cash flows due to ongoing fluctuations in our Contract Capital balance and the prospective cash impacts of the project charges described above. See “Credit Facilities and Debt” below for further discussion of our liquidity.

Investing Activities—During the first six months of 2017, net cash provided by investing activities was $653.3 million, and primarily related to proceeds resulting from the sale of our discontinued Capital Services Operations of $645.5 million, net of cash sold (see Note 4 to our Financial Statements for further discussion) and net inflows from advances of $50.4 million to our venture partners by our proportionately consolidated ventures (see Note 7 to our Financial Statements for further discussion), partly offset by capital expenditures of $34.3 million and other investments of $9.9 million.

Financing Activities—During the first six months of 2017, net cash used in financing activities was $394.5 million, and primarily related to repayments on our long-term debt and net revolving facility and other short-term debt of $318.8 million and $33.5 million, respectively, distributions to our noncontrolling interest partners of $24.3 million, dividends paid to our shareholders of $14.1 million, deferred financing costs of $13.8 million associated with amendments for our committed and uncommitted facilities (see Note 8 to our Financial Statements for further discussion), and stock-based compensation-related withholding taxes on taxable share distributions totaling $9.1 million (0.3 million shares at an average price of $30.37 per share). These cash outflows were partly offset by net advances from our equity method and proportionately consolidated ventures of $11.8 million (see Note 7 to our Financial Statements for further discussion) and cash proceeds from the issuance of shares associated with our stock plans of $7.2 million.

Effect of Exchange Rate Changes on Cash and Cash Equivalents—During the first six months of 2017, our cash and cash equivalents balance increased by $57.0 million due to the impact of changes in functional currency exchange rates against the U.S. Dollar for non-U.S. Dollar cash balances, primarily for net changes in the Australian Dollar, British Pound, and Euro exchange rates. The net unrealized gain on our cash and cash equivalents resulting from these exchange rate movements is reflected in the cumulative translation adjustment component of OCI. Our cash and cash equivalents held in non-U.S. Dollar currencies are used primarily for project-related and other operating expenditures in those currencies, and therefore, our exposure to realized exchange gains and losses is not anticipated to be material.

Credit Facilities and Debt

General—Our primary internal source of liquidity is cash flow generated from operations and capacity under our revolving credit and other facilities discussed below. Such facilities are used to fund operating, investing and financing activities, and provide necessary letters of credit. Letters of credit are generally issued to customers in the ordinary course of business to support advance payments and performance guarantees, in lieu of retention on our contracts, or in certain cases, are issued in support of our insurance programs.

Committed Facilities—We have a five-year, $1.15 billion committed revolving credit facility (the “Revolving Facility”) with Bank of America N.A. (“BofA”), as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole Corporate and Investment Bank (“Credit Agricole”) and TD Securities, each as syndication agents, which expires in October 2018. The Revolving Facility had a $230.0 million financial letter of credit sublimit at June 30, 2017. However, as a

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result of the amendments described below, effective August 9, 2017, the financial letter of credit sublimit was replaced with a $100.0 million total letter of credit sublimit. At June 30, 2017, we had $204.0 million and $67.2 million of outstanding borrowings and letters of credit (none of which were financial letters of credit) under the facility, respectively, providing $878.8 million of available capacity, of which $32.8 million was available for letters of credit based on our new total letter of credit sublimit.

We also have a five-year, $800.0 million committed revolving credit facility (the “Second Revolving Facility”) with BofA, as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole and Bank of Tokyo Mitsubishi UFJ, each as syndication agents, which expires in July 2020. The Second Revolving Facility supplements our Revolving Facility, and had a $50.0 million financial letter of credit sublimit at June 30, 2017. However, as a result of the amendments described below, effective August 9, 2017, the financial letter of credit sublimit was replaced with a $100.0 million total letter of credit sublimit. At June 30, 2017, we had $170.0 million and $72.4 million of outstanding borrowings and letters of credit (including $2.8 million of financial letters of credit) under the facility, respectively, providing $557.6 million of available capacity, of which $27.6 million was available for letters of credit based on our new total letter of credit sublimit.

During the first six months of 2017, maximum outstanding borrowings under our Revolving Facility and Second Revolving Facility (together, “Committed Facilities”) were approximately $1.7 billion. We are assessed quarterly commitment fees on the unutilized portion of the facilities as well as letter of credit fees on outstanding letters of credit. Through the date of the amendments described below, the interest, commitment fee, and letter of credit fee percentages were based on our quarterly leverage ratio and interest on borrowings under the facilities was assessed at either prime plus an applicable floating margin (4.25% and 1.50%, respectively at June 30, 2017), or LIBOR plus an applicable floating margin (1.23% and 2.50%, respectively at June 30, 2017). However, as a result of the amendments, effective August 9, 2017, interest on borrowings under the amended facilities will be assessed at either prime plus 4.00% or LIBOR plus 5.00%. In addition, our fees for financial and performance letters of credit will be 5.00% and 3.50%, respectively. During the first six months of 2017, our weighted average interest rate on borrowings under the Revolving Facility and Second Revolving Facility was approximately 3.3% and 4.9%, respectively, inclusive of the applicable floating margin. The Committed Facilities have financial and restrictive covenants described further below.

Uncommitted Facilities—We also have various short-term, uncommitted letter of credit facilities (the “Uncommitted Facilities”) across several geographic regions, under which we had $1.6 billion of outstanding letters of credit as of June 30, 2017.

Term Loans—On February 13, 2017, we paid the remaining $300.0 million of principal on our four-year, $1.0 billion unsecured term loan (the “Term Loan”) with BofA as administrative agent. Interest was based upon LIBOR plus an applicable floating margin for the period (0.98% and 2.25%, respectively). In conjunction with the repayment of the Term Loan, we also settled our associated interest rate swap that hedged against a portion of the Term Loan, which resulted in a weighted average interest rate of approximately 2.6% during the first quarter 2017.

At June 30, 2017, we had $481.3 million outstanding under a five-year, $500.0 million term loan (the “Second Term Loan”) with BofA as administrative agent. Interest and principal under the Second Term Loan is payable quarterly in arrears beginning in June 2017, and through the date of the amendments described below, bore interest at LIBOR plus an applicable floating margin (1.23% and 2.50%, respectively at June 30, 2017). However, as a result of the amendments, effective August 9, 2017, interest will be assessed at either prime plus 4.00% or LIBOR plus 5.00%. During the first six months of 2017, our weighted average interest rate on the Second Term Loan was approximately 3.1%, inclusive of the applicable floating margin. Future annual maturities for the Second Term Loan are $37.5 million, $75.0 million, $75.0 million and $293.8 million for 2017, 2018, 2019, and 2020, respectively. The Second Term Loan has financial and restrictive covenants described further below.

Senior Notes—We have a series of senior notes totaling $800.0 million in aggregate principal amount outstanding as of June 30, 2017 (the “Senior Notes”). The Senior Notes include Series A through D and contained the following terms at June 30, 2017:

• Series A—Interest due semi-annually at a fixed rate of 4.65%, with principal of $150.0 million due in December 2017

• Series B—Interest due semi-annually at a fixed rate of 5.07%, with principal of $225.0 million due in December 2019

• Series C—Interest due semi-annually at a fixed rate of 5.65%, with principal of $275.0 million due in December 2022

• Series D—Interest due semi-annually at a fixed rate of 5.80%, with principal of $150.0 million due in December 2024

On July 28, 2017, we utilized $211.8 million of the proceeds from the sale of the Capital Services Operations to repay a portion of each series of senior notes in the following amounts: (Series A - $44.6 million, Series B - $58.2 million, Series C - $78.5 million and Series D - $30.5 million). The repayment dates for the remaining principal amounts remained the same.

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We also have senior notes totaling $200.0 million in aggregate principal amount outstanding as of June 30, 2017 (the “Second Senior Notes”) with BofA as administrative agent. At June 30, 2017, interest was due semi-annually at a fixed rate of 5.03%, with principal of $200.0 million due in July 2025. On July 28, 2017, we utilized $57.1 million of the proceeds from the sale of the Capital Services Operations to repay a portion of the Second Senior Notes. The repayment date for the remaining principal amount remained the same.

The Senior Notes and Second Senior Notes (together, the “Notes”) have financial and restrictive covenants described further below. Further, as a result of the amendments described below, our fixed interest rate on the amended Notes was increased by an incremental 2.50% over the rates in effect immediately prior to such amendments. The amended Notes also include provisions relating to our credit profile, which if not maintained will result in an incremental annual cost of up to 1.50% of the outstanding balance under the Notes. Further, the Notes include provisions relating to our leverage, which if not maintained, could result in an incremental annual cost of up to 1.00% (or 0.50% depending on our leverage level) of the outstanding balance under the Notes, provided that the incremental annual cost related to our credit profile and leverage cannot exceed 2.00% per annum. Finally, the Notes are subject to a make-whole premium in connection with certain prepayment events.

Compliance and Other—On February 24, 2017, and effective for the period ended December 31, 2016, we amended our Revolving Facility, Second Revolving Facility, and Second Term Loan (collectively, “Bank Facilities”) and Notes (collectively, with Bank Facilities, “Senior Facilities”). The amendments:

• Established a new maximum leverage ratio of 3.50 at December 31, 2016, decreasing to 3.00 at December 31, 2017, or 45 days subsequent to the closing of the sale of our Capital Services Operations (the “Closing Date”), if earlier.

• Established a new minimum net worth of $1.2 billion, maintained our required fixed charge coverage ratio at 1.75, and reduced our Revolving Facility from $1.35 billion to $1.15 billion at the Closing Date.

• Included other financial and restrictive covenants, including restrictions regarding subsidiary indebtedness, sales of assets, liens, investments, type of business conducted, and mergers and acquisitions, and restrictions on dividend payments and share repurchases, among other restrictions.

On May 8, 2017, and effective for the period ended March 31, 2017, we further amended our Senior Facilities. The amendments:

• Required us to secure the Senior Facilities through the pledge of cash, accounts receivable, inventory, fixed assets, and stock of subsidiaries, which was in the process of being completed as of June 30, 2017.

• Required us to repay portions of the Senior Facilities with all of the net proceeds from the sale of our Capital Services Operations, the issuance of any unsecured debt that is subordinate (“Subordinated Debt”) to the Senior Facilities, the issuance of any equity securities, or the sale of any assets.

• Established new maximum leverage ratios for borrowings under the Senior Facilities as follows: 4.00 at March 31, 2017; 4.50 at June 30, 2017 and September 30, 2017; 3.00 at December 31, 2017 and March 31, 2018; and 2.50 at June 30, 2018.

• Established total maximum leverage ratios (in addition to those established for the Senior Facilities) for all borrowings among the Senior Facilities and any Subordinated Debt as follows: 5.25 at June 30, 2017; 6.00 at September 30, 2017; 4.00 at December 31, 2017 and March 31, 2018; 3.25 at June 30, 2018; and 3.00 at September 30, 2018.

• Prohibited mergers and acquisitions, open-market share repurchases, and increases to dividends until our leverage ratio is below 3.00 for two consecutive quarters.

As a result of the project impacts in the second quarter 2017 (discussed within “Results of Operations”), as of June 30, 2017, we would not have been in compliance with the previously amended financial covenants for our Senior Facilities, without certain waivers and amendments. Accordingly, effective August 9, 2017 (the “Effective Date”), and effective for the period ended June 30, 2017, we are further amending our Senior Facilities. The amendments, which are subject to final documentation, waive our noncompliance with our existing covenants as of June 30, 2017 and certain other defaults and events of default. In addition, the amendments:

• Eliminate our Minimum Net Worth covenant required by our previous amendments.

• Require minimum levels of trailing 12-month earnings before interest, taxes, depreciation and amortization (“EBITDA”), as defined by the amendments, as follows: $500.0 million at September 30, 2017; $550.0 million at December 31, 2017; $500.0 million at March 31, 2018; $450.0 million at June 30, 2018 and September 30, 2018; and $425.0 million at December 31, 2018 and thereafter (“Minimum EBITDA”). Trailing 12-month EBITDA for purposes of determining compliance with the Minimum EBITDA covenant will be adjusted to exclude: an agreed amount attributable to any restructuring or integration charges during the third and fourth quarters of 2017; an agreed amount

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attributable to previous charges on certain projects which occurred during the first and second quarters of 2017; and an agreed amount for potential future charges for the same projects if they were to be incurred during the third and fourth quarters of 2017 (collectively, the “EBITDA Addbacks”).

• Provide for the replacement of our previous maximum leverage ratio and minimum fixed charge ratio with a new maximum leverage ratio of 1.75 (“Maximum Leverage Ratio”) and new minimum fixed charge coverage ratio of 2.25 (“Minimum Fixed Charge Coverage Ratio), which are temporarily suspended and will resume as of March 31, 2018. Trailing 12-month EBITDA for purposes of determining compliance with the Maximum Leverage Ratio and consolidated net income for purposes of determining compliance with the Minimum Fixed Charge Coverage Ratio will be adjusted for the EBITDA Addbacks.

• Require us to execute on our plan to market and sell our Technology Operations by December 27, 2017 (the “Technology Sale”), with an extension of up to 60 days at the discretion of the holders of a majority of the outstanding Notes and at the discretion of the administrative agents of the Bank Facilities.

• Require us to maintain a minimum aggregate availability under our Revolving Facility and Second Revolving Facility, including borrowings and letters of credit, of $150.0 million at all times from the Effective Date through the date of the Technology Sale, and $250.0 million thereafter (“Minimum Availability”). Our amendments require the net cash proceeds from the Technology Sale be used to repay our Senior Facilities (“Mandatory Repayment Amount”). Further, our aggregate capacity under the Revolving Facility and Second Revolving Facility will be reduced by seventy percent (70%) of the portion of the Mandatory Repayment Amount allocable to the Revolving Facility and Second Revolving Facility, upon closing the Technology Sale and certain other mandatory prepayment events.

• Limit the amount of certain of our funded indebtedness to $3.0 billion prior to the Technology Sale and $2.9 billion thereafter, in each case, subject to reduction pursuant to scheduled repayments and mandatory prepayments thereof (but, with respect to the Revolving Facility and Second Revolving Facility, only to the extent the commitments have been reduced by such prepayments) made by us after the Effective Date.

• Prohibit mergers and acquisitions, open-market share repurchases and dividend payments and certain inter-company transactions.

• Replace the previous financial letter of credit sublimits for our Revolving Facility and Second Revolving Facility with a $100.0 million letter of credit sublimit for each, as described further above.

• Adjust the interest rates on our Senior Facilities, as described further above.

As discussed above, our amended covenants require, among other things, the completion of our plan to sell the Technology Operations. Further, we are required to comply with various new restrictive and financial covenants, including the Minimum EBITDA and Minimum Availability covenants. Although we received temporary suspension of our Maximum Leverage Ratio and Minimum Fixed Charge Coverage Ratio, these covenants will resume effective March 31, 2018. Based on our forecasted EBITDA and cash flows, we project that future compliance with certain covenants subsequent to December 31, 2017 will require the completion of the Technology Sale and associated net proceeds consistent with our expectations. Accordingly, debt of approximately $1.2 billion, which by its terms is due beyond one year and would otherwise be shown as long-term, has been classified as current, as certain factors regarding our compliance with such covenants is beyond our control.

It is our intention to execute the actions necessary to enable us to maintain compliance with the financial and other covenants described above. We have initiated the steps necessary to market and sell our Technology Operations and believe it is probable we will complete the sale within the time frame required by the terms of our amendments.

We believe we will accomplish our plans to maintain compliance with our financial and other covenants, and believe our cash on hand, proceeds from divestitures, cash flow from operations, and amounts available under our Committed Facilities and Uncommitted Facilities will be sufficient to finance our capital expenditures, settle our commitments and contingencies (as more fully described in Note 11 to our Financial Statements) and address our working capital needs for the foreseeable future. However, there can be no assurance that we will be successful. Our ability to generate cash flows from operations, access funding under our Committed and Uncommitted Facilities at reasonable terms, and comply with our financial and other covenants may be impacted by a variety of business, economic, legislative, financial and other factors which may be outside of our control, including, but not limited to: our ability to access appropriate capital markets and complete asset dispositions, delay or cancellation of projects; decreased profitability on our projects; decreased cash flows on our projects due to the timing of receipts and required payments of liabilities and funding of our loss projects; the timing of approval or settlement of unapproved change orders and claims; changes in foreign currency exchange or interest rates; performance of pension plan assets; or changes in actuarial assumptions. Further, we could be impacted if our customers experience a material change in their ability to pay us or if the banks associated with our lending facilities were to cease or reduce operations, or if there is a full or partial break-up of the EU or its currency, the Euro. In addition, there can be no assurances that we will sell our Technology

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Operations for net proceeds consistent with our expectations, or that the administrative agents for our Bank Facilities and holders of a majority of the outstanding Notes will grant us any necessary extension to complete the Technology Sale, or provide us with any necessary waivers or amendments if we were unable to maintain compliance with our financial or other covenants. If we are unable to remain in compliance, and such covenants are not further waived or amended, it could result in our debt becoming immediately due.

In addition, although we had approximately $1.6 billion of outstanding letters of credit under our Uncommitted Facilities at June 30, 2017, these facilities are all unsecured. There can be no assurance that these outstanding letters of credit will be renewed on their scheduled annual renewal dates or that new letters of credit can be sourced from our Uncommitted Facilities. In addition, there can be no assurance that we will have sufficient capacity under our Senior Facilities for replacement of such letters of credit or new letters of credit, if required.

Other

In addition to providing letters of credit, we also issue surety bonds in the ordinary course of business to support our contract performance. At June 30, 2017, we had $358.7 million of outstanding surety bonds in support of our projects. In addition, we had $473.2 million of surety bonds maintained on behalf of our former Capital Services Operations, for which we have received an indemnity from CSVC. We also continue to maintain guarantees on behalf of our former Capital Services Operations in support of approximately $166.0 million of backlog, for which we have also received an indemnity.

Although we currently have uncommitted bonding facilities, a termination or reduction of these bonding facilities could result in the utilization of letters of credit in lieu of performance bonds, thereby reducing the available capacity under the Committed Facilities. Although we do not anticipate a reduction or termination of our bonding facilities, there can be no assurance that such facilities will continue to be available at reasonable terms to meet our ordinary course requirements.

A portion of our pension plans’ assets are invested in EU government securities, which could be impacted by economic turmoil in Europe or a full or partial break-up of the EU or its currency, the Euro. However, given the long-term nature of pension funding requirements, in the event any of our pension plans (including those with investments in EU government securities) become materially underfunded from a decline in value of our plan assets, we believe our cash on hand, proceeds from divestitures, and amounts available under our existing Committed Facilities and Uncommitted Facilities would be sufficient to fund any increases in future contribution requirements.

We are a defendant in a number of lawsuits arising in the normal course of business and we have in place insurance coverage that we believe is appropriate for the type of work that we perform. As a matter of practice, we review our litigation accrual quarterly and as further information is known on pending cases, increases or decreases, as appropriate, may be recorded. See Note 11 to our Financial Statements for a discussion of pending litigation.

OFF-BALANCE SHEET ARRANGEMENTS

We use operating leases for facilities and equipment when they make economic sense, including sale-leaseback arrangements. Our sale-leaseback arrangements are not material to our Financial Statements, and we have no other significant off-balance sheet arrangements.

NEW ACCOUNTING STANDARDS

See the applicable section of Note 2 to our Financial Statements for a discussion of new accounting standards.

CRITICAL ACCOUNTING ESTIMATES

The discussion and analysis of our financial condition and results of operations are based upon our Financial Statements, which have been prepared in accordance with U.S. GAAP. The preparation of these Financial Statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. We continually evaluate our estimates based upon historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our management has discussed the development and selection of our critical accounting estimates with the Audit Committee of our Supervisory Board. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our Financial Statements.

Revenue Recognition

Our revenue is primarily derived from long-term contracts and is generally recognized using the POC method, primarily based on the percentage that actual costs-to-date bear to total estimated costs to complete each contract. We follow the guidance of FASB ASC Revenue Recognition Topic 605-35 for accounting policies relating to our use of the POC method, estimating costs, and revenue recognition, including the recognition of incentive fees, unapproved change orders and claims, and combining and segmenting contracts. We primarily utilize the cost-to-cost approach to estimate POC as we believe this method is less subjective than relying on assessments of physical progress. Under the cost-to-cost approach, the use of estimated costs

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to complete each contract is a significant variable in the process of determining recognized revenue and is a significant factor in the accounting for contracts. Significant estimates that impact the cost to complete each contract are costs of engineering, materials, components, equipment, labor and subcontracts; labor productivity; schedule durations, including subcontractor or supplier progress; liquidated damages; contract disputes, including claims; achievement of contractual performance requirements; and contingency, among others. The cumulative impact of revisions in total cost estimates during the progress of work is reflected in the period in which these changes become known, including, to the extent required, the reversal of profit recognized in prior periods and the recognition of losses expected to be incurred on contracts in progress. Due to the various estimates inherent in our contract accounting, actual results could differ from those estimates. See Note 14 to our Financial Statements for discussion of projects with significant changes in estimated margins during the second quarter and year-to-date 2017 and 2016 periods.

Our long-term contracts are awarded on a competitively bid and negotiated basis and the timing of revenue recognition may be impacted by the terms of such contracts. We use a range of contracting options, including cost-reimbursable, fixed-price and hybrid, which has both cost-reimbursable and fixed-price characteristics. Fixed-price contracts, and hybrid contracts with a more significant fixed-price component, tend to provide us with greater control over project schedule and the timing of when work is performed and costs are incurred, and accordingly, when revenue is recognized. Cost-reimbursable contracts, and hybrid contracts with a more significant cost-reimbursable component, generally provide our customers with greater influence over the timing of when we perform our work, and accordingly, such contracts often result in less predictability with respect to the timing of revenue recognition. Contract revenue for our long-term contracts recognized under the POC method reflects the original contract price adjusted for approved change orders and estimated recoveries for incentive fees, unapproved change orders and claims, and liquidated damages. We recognize revenue associated with incentive fees when the value can be reliably estimated and recovery is probable. We recognize revenue associated with unapproved change orders and claims to the extent the related costs have been incurred, the value can be reliably estimated and recovery is probable. Our recorded incentive fees, unapproved change orders and claims reflect our best estimate of recovery amounts; however, the ultimate resolution and amounts received could differ from these estimates. Liquidated damages are reflected as a reduction to contract price to the extent they are deemed probable. See Note 14 to our Financial Statements for additional discussion of our recorded unapproved change orders, claims and incentives.

With respect to our EPC services, our contracts are not segmented between types of services, such as engineering and construction, if each of the EPC components is negotiated concurrently or if the pricing of any such services is subject to the ultimate negotiation and agreement of the entire EPC contract. However, an EPC contract including technology or fabrication services may be segmented if we satisfy the segmenting criteria in ASC 605-35. Revenue recorded in these situations is based on our prices and terms for similar services to third party customers. Segmenting a contract may result in different interim rates of profitability for each scope of service than if we had recognized revenue without segmenting. In some instances, we may combine contracts that are entered into in multiple phases, but are interdependent and include pricing considerations by us and the customer that are impacted by all phases of the project. Otherwise, if each phase is independent of the other and pricing considerations do not give effect to another phase, the contracts will not be combined.

Cost of revenue for our long-term contracts includes direct contract costs, such as materials and labor, and indirect costs that are attributable to contract activity. The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Projects with costs and estimated earnings recognized to date in excess of cumulative billings is reported on the Balance Sheet as costs and estimated earnings in excess of billings. Projects with cumulative billings in excess of costs and estimated earnings recognized to date is reported on the Balance Sheet as billings in excess of costs and estimated earnings. Any uncollected billed amounts, including contract retentions, are reported as accounts receivable.

Revenue for our service contracts that do not satisfy the criteria for revenue recognition under the POC method is recorded at the time services are performed. Revenue associated with incentive fees for these contracts is recognized when earned. Unbilled receivables for our service contracts are recorded within accounts receivable.

Revenue for our pipe and steel fabrication and catalyst manufacturing contracts that are independent of an EPC contract, or for which we satisfy the segmentation criteria discussed above, is recognized upon shipment of the fabricated or manufactured units. During the fabrication or manufacturing process, all related direct and allocable indirect costs are capitalized as work in process inventory and such costs are recorded as cost of revenue at the time of shipment.

Goodwill

Goodwill Summary and Reporting Units—At June 30, 2017, our goodwill balance was $2.8 billion. Goodwill is not amortized to earnings, but instead is reviewed for impairment at least annually at a reporting unit level, absent any indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based upon balances as of October 1. At December 31, 2016, we had the following three operating groups and reporting units:

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• Engineering & Construction—Our Engineering & Construction operating group represented a reporting unit.

• Fabrication Services—Our Fabrication Services operating group represented a reporting unit.

• Technology—Our Technology operating group represented a reporting unit.

Impairment Assessment—During the fourth quarter 2016, we performed a quantitative assessment of goodwill for each of the aforementioned reporting units. Based upon these quantitative assessments, the fair value of each of these reporting units substantially exceeded their respective net book values, and accordingly, no impairment charge was necessary as a result of our annual impairment assessment. During the second quarter 2017, we experienced a decline in our market capitalization and incurred charges on certain projects within our Engineering & Construction reporting unit that resulted in a net loss for the second quarter and year-to-date 2017 periods. We believe these events and circumstances were indicators that goodwill of our Engineering & Construction reporting unit was potentially impaired. Accordingly, we performed a quantitative assessment of goodwill for our Engineering & Construction reporting unit as of June 30, 2017. Based on this quantitative assessment, the fair value of the Engineering & Construction reporting unit continued to substantially exceed its net book value, and accordingly, no impairment charge was necessary as a result of our interim impairment assessment. If we were to experience an additional decline in our market capitalization, or a prolonged market capitalization at our current levels, it could indicate that the goodwill of our reporting units is impaired, and require additional interim quantitative impairment assessments. If, based on future assessments our goodwill is deemed to be impaired, the impairment would result in a charge to earnings in the period of impairment. There can be no assurance that future goodwill impairment tests will not result in charges to earnings.

Determination of Reporting Unit Fair Values—To determine the fair value of our reporting units and test for impairment, we utilized an income approach (discounted cash flow method) as we believe this is the most direct approach to incorporate the specific economic attributes and risk profiles of our reporting units into our valuation model. This is consistent with the methodology used to determine the fair value of our reporting units in previous years. We generally do not utilize a market approach given the lack of relevant information generated by market transactions involving comparable businesses. However, to the extent market indicators of fair value become available, we consider such market indicators in our discounted cash flow analysis and determination of fair value. The discounted cash flow methodology is based, to a large extent, on assumptions about future events, which may or may not occur as anticipated, and such deviations could have a significant impact on the calculated estimated fair values of our reporting units. These assumptions include, but are not limited to, estimates of discount rates, future growth rates, and terminal values for each reporting unit. The discounted cash flow analysis for our fourth quarter 2016 annual assessment included forecasted cash flows for the fourth quarter 2016 and a seven-year forecast period thereafter (2017 through 2023), with our 2017 business plan used as the basis for our 2017 projections. The discounted cash flow analysis for our second quarter 2017 interim assessment included forecasted cash flows for the third and fourth quarters of 2017 and a seven-year forecast period thereafter (2018 through 2024). These forecasted cash flows took into consideration historical and recent results, the reporting unit’s backlog and near term prospects, and management’s outlook for the future. A terminal value was also calculated using a terminal value growth assumption to derive the annual cash flows after the discrete forecast period. A reporting unit specific discount rate was applied to the forecasted cash flows and terminal cash flows to determine the discounted future cash flows, or fair value, of each reporting unit.

See Note 6 to our Financial Statements for additional discussion of our goodwill.

Other Long-Lived Assets

We amortize our finite-lived intangible assets on a straight-line basis with lives ranging from 6 to 20 years, absent any indicators of impairment. We review tangible assets and finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If a recoverability assessment is required, the estimated future cash flow associated with the asset or asset group will be compared to their respective carrying amounts to determine if an impairment exists. During the first six months of 2017, we noted no indicators of impairment. See Note 6 to our Financial Statements for additional discussion of our intangible assets.

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis using currently enacted income tax rates for the years in which the differences are expected to reverse. A valuation allowance (“VA”) is provided to offset any net deferred tax assets (“DTA(s)”) if, based upon the available evidence, it is more likely than not that some or all of the DTAs will not be realized. The realization of our net DTAs depends upon our ability to generate sufficient future taxable income of the appropriate character and in the appropriate jurisdictions.

On a periodic and ongoing basis we evaluate our DTAs and assess the appropriateness of our VA’s. In assessing the need for a VA, we consider both positive and negative evidence related to the likelihood of realization of the DTAs. If, based on the weight of available evidence, our assessment indicates that it is more likely than not that a DTA will not be realized, we record a VA. Our assessments include, among other things, the value and quality of our backlog, evaluations of existing and

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anticipated market conditions, analysis of recent and historical operating results and projections of future results, strategic plans and alternatives for associated operations, as well as asset expiration dates, where applicable. If the factors upon which we based our assessment of realizability of our DTAs differ materially from our expectations, including future operating results being lower than our current estimates, our future assessments could be impacted and result in an increase in VA and increase in tax expense.

Income tax and associated interest and penalty reserves, where applicable, are recorded in those instances where we consider it more likely than not that additional tax will be due in excess of amounts reflected in income tax returns filed worldwide, irrespective of whether or not we have received tax assessments. We continually review our exposure to additional income tax obligations and, as further information is known or events occur, changes in our tax and penalty reserves may be recorded within income tax expense and changes in interest reserves may be recorded in interest expense.

Insurance

We maintain insurance coverage for various aspects of our business and operations. However, we retain a portion of anticipated losses through the use of deductibles and self-insured retentions for our exposures related to third party liability and workers’ compensation. We regularly review estimates of reported and unreported claims through analysis of historical and projected trends, in conjunction with actuaries and other consultants, and provide for losses through insurance reserves. As claims develop and additional information becomes available, adjustments to loss reserves may be required. If actual results are not consistent with our assumptions, we may be exposed to gains or losses that could be material.

Partnering Arrangements

In the ordinary course of business, we execute specific projects and conduct certain operations through joint venture, consortium and other collaborative arrangements (collectively referred to as “venture(s)”). We have various ownership interests in these ventures, with such ownership typically proportionate to our decision making and distribution rights. The ventures generally contract directly with the third party customer; however, services may be performed directly by the ventures, or may be performed by us, our partners, or a combination thereof.

Venture net assets consist primarily of working capital and property and equipment, and assets may be restricted from being used to fund obligations outside of the venture. These ventures typically have limited third party debt or have debt that is non-recourse in nature; however, they may provide for capital calls to fund operations or require participants in the venture to provide additional financial support, including advance payment or retention letters of credit.

Each venture is assessed at inception and on an ongoing basis as to whether it qualifies as a VIE under the consolidations guidance in ASC 810. A venture generally qualifies as a VIE when it (1) meets the definition of a legal entity, (2) absorbs the operational risk of the projects being executed, creating a variable interest, and (3) lacks sufficient capital investment from the partners, potentially resulting in the venture requiring additional subordinated financial support, if necessary, to finance its future activities.

If at any time a venture qualifies as a VIE, we perform a qualitative assessment to determine whether we are the primary beneficiary of the VIE and, therefore, need to consolidate the VIE. We are the primary beneficiary if we have (1) the power to direct the economically significant activities of the VIE and (2) the right to receive benefits from, and obligation to absorb losses of, the VIE. If the venture is a VIE and we are the primary beneficiary, or we otherwise have the ability to control the venture, we consolidate the venture. If we are not determined to be the primary beneficiary of the VIE, or only have the ability to significantly influence, rather than control the venture, we do not consolidate the venture. We account for unconsolidated ventures using either proportionate consolidation for both the Balance Sheet and Statement of Operations, when we meet the applicable accounting criteria to do so, or utilize the equity method. See Note 7 to our Financial Statements for additional discussion of our material partnering arrangements.

Financial Instruments

We do not engage in currency speculation; however, we utilize foreign currency exchange rate derivatives on an ongoing basis to hedge against certain foreign currency related operating exposures. We generally seek hedge accounting treatment for contracts used to hedge operating exposures and designate them as cash flow hedges. Therefore, gains and losses, exclusive of credit risk and forward points (which represent the time value component of the fair value of our derivative positions), are included in AOCI until the associated underlying operating exposure impacts our earnings. Changes in the fair value of (1) credit risk and forward points, (2) instruments deemed ineffective during the period, and (3) instruments that we do not designate as cash flow hedges, are recognized within cost of revenue.

See Note 9 to our Financial Statements for additional discussion of our financial instruments.

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FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q, including all documents incorporated by reference, contains forward-looking statements regarding CB&I and represents our expectations and beliefs concerning future events. These forward-looking statements are intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995 as set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act. The forward-looking statements included herein or incorporated herein by reference include or may include, but are not limited to, (and you should read carefully) any statements that are predictive in nature, depend upon or refer to future events or conditions, or use or contain words, terms, phrases, or expressions such as “achieve,” “forecast,” “plan,” “propose,” “strategy,” “envision,” “hope,” “will,” “continue,” “potential,” “expect,” “believe,” “anticipate,” “project,” “estimate,” “predict,” “intend,” “should,” “could,” “may,” “might,” or similar words, terms, phrases, or expressions or the negative of any of these terms. Any statements in this prospectus that are not based on historical fact are forward-looking statements and represent our best judgment as to what may occur in the future. These forward-looking statements include, but are not limited to, statements that relate to, or statements that are subject to risks, contingencies or uncertainties that relate to:

• new awards and backlog and future business opportunities;

• future levels of demand, including expectations regarding: planned investments across the natural gas value chain, including LNG and petrochemicals; continued investments in projects based on U.S. shale gas; global investments in power and petrochemical facilities are expected to continue; and investments in various types of facilities that require storage structures and pre-fabricated pipe;

• the execution of activities on and completion of specific projects, including timing to complete, future productivity and cost to complete;

• estimates of percentage of completion and contract profits or losses;

• estimates regarding liquidated damages;

• expectations regarding the sale of our Technology operating group;

• expectations regarding the future compliance with our financial and other covenants in the agreements governing our primary financing arrangements;

• expectations regarding access to sources of liquidity and capital resources, including access to bonding facilities;

• future levels of capital expenditures;

• anticipated tax rates;

• expectations regarding exchange gains and losses;

• expectations regarding defined benefit pension and other postretirement plan contributions and investment performance;

• the potential effects of judicial or other proceedings on our business, financial condition, results of operations and cash flows; and

• the anticipated effects of actions of third parties such as competitors, or regulatory authorities, or plaintiffs in litigation.

Forward-looking statements involve known and unknown risks and uncertainties. In addition to the material risks listed under “Item 1A. Risk Factors,” as set forth in our Form 10-K filed with the SEC for the year ended December 31, 2016 that may cause business conditions or our actual results, performance or achievements to be materially different from those expressed or implied by any forward-looking statements, the following are some, but not all, of the factors that might cause business conditions or our actual results, performance or achievements to be materially different from those expressed or implied by any forward-looking statements or contribute to such differences:

• our ability to realize cost savings from our expected performance of contracts, whether as a result of improper estimates, performance, or otherwise;

• uncertain timing and funding of new contract awards, as well as project cancellations;

• our ability to fully realize the revenue value reported in our backlog;

• cost overruns on fixed price or similar contracts or failure to receive timely or proper payments on cost reimbursable contracts, whether as a result of improper estimates, performance, disputes or otherwise;

• risks associated with labor productivity;

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• risks associated with government contracts that may be subject to modification or termination;

• risks associated with percentage-of-completion accounting; our ability to settle or negotiate unapproved change orders and claims;

• changes in the costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors;

• adverse impacts from weather affecting our performance and timeliness of completion, which could lead to increased costs and affect the quality, costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors;

• operating risks, which could lead to increased costs and affect the quality, costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors;

• increased competition;

• fluctuating revenue resulting from a number of factors, including a decline in energy prices and the cyclical nature of the individual markets in which our customers operate;

• delayed or lower than expected activity in the energy and natural resources industries, demand from which is the largest component of our revenue;

• lower than expected growth in our primary end markets, including but not limited to LNG and energy processes;

• risks associated with non-compliance with covenants in our financing arrangements;

• risks inherent in acquisitions and our ability to complete or obtain financing for acquisitions;

• our ability to integrate and successfully operate and manage acquired businesses and the risks associated with those businesses;

• the non-competitiveness or unavailability of, or lack of demand or loss of legal protection for, our intellectual property assets or rights;

• failure to keep pace with technological changes or innovation;

• failure of our patents or licensed technologies to perform as expected or to remain competitive, current, in demand, profitable or enforceable;

• adverse outcomes of pending claims or litigation or the possibility of new claims or litigation, and the potential effect of such claims or litigation on our business, financial position, results of operations and cash flow;

• lack of necessary liquidity to provide bid, performance, advance payment and retention bonds, guarantees, or letters of credit securing our obligations under our bids and contracts or to finance expenditures prior to the receipt of payment for the performance of contracts;

• proposed and actual revisions to U.S. and non-U.S. tax laws, and interpretation of said laws, Dutch tax treaties with foreign countries and U.S. tax treaties with non-U.S. countries (including, but not limited to, The Netherlands), which would seek to increase income taxes payable;

• political and economic conditions including, but not limited to, war, conflict or civil or economic unrest in countries in which we operate;

• compliance with applicable laws and regulations in any one or more of the countries in which we operate including, but not limited to, the U.S. Foreign Corrupt Practices Act and those concerning the environment, export controls, anti-money laundering and trade sanction programs;

• foreign currency risk and our inability to properly manage or hedge currency or similar risks; and

• a downturn, disruption, or stagnation in the economy in general.

Although we believe the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee future performance or results. You should not unduly rely on any one forward-looking statement or these forward-looking statements in general. Each forward-looking statement is made and applies only as of the date of the particular statement, and we are not obligated to update, withdraw, or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should consider these risks when reading any forward-looking statements. All forward-looking statements attributed or attributable to us or to persons acting on our behalf are expressly qualified in their entirety by this section entitled “Information Regarding Forward-Looking Statements.”

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Item 3.Quantitative and Qualitative Disclosures About Market Risk

Foreign Currency Risk—We are exposed to market risk associated with changes in foreign currency exchange rates, which may adversely affect our results of operations, financial condition and cash flows.

One form of exposure to fluctuating exchange rates relates to the effects of translating financial statements of entities with functional currencies other than the U.S. Dollar into our reporting currency. With respect to the translation of our balance sheet, net movements in the Australian Dollar, British Pound, and Euro exchange rates against the U.S. Dollar favorably impacted the cumulative translation adjustment component of AOCI by approximately $56.0 million, net of tax, and our cash balance was favorably impacted by approximately $57.0 million. We generally do not hedge our exposure to potential foreign currency translation adjustments.

Another form of exposure to fluctuating exchange rates relates to the effects of transacting in currencies other than those of our entity’s functional currencies. We do not engage in currency speculation; however, we utilize foreign currency exchange rate derivatives on an ongoing basis to hedge against certain foreign currency related operating exposures. We generally seek hedge accounting treatment for contracts used to hedge operating exposures and designate them as cash flow hedges. Therefore, gains and losses, exclusive of credit risk and forward points (which represent the time value component of the fair value of our derivative positions), are included in AOCI until the associated underlying operating exposure impacts our earnings. Changes in the fair value of (1) credit risk and forward points, (2) instruments deemed ineffective during the period, and (3) instruments that we do not designate as cash flow hedges, are recognized within cost of revenue and were not material during the first six months of 2017.

At June 30, 2017, the notional value of our outstanding forward contracts to hedge certain foreign currency exchange-related operating exposures was $139.6 million, including net foreign currency exchange rate exposure associated with the purchase of U.S. Dollars ($95.1 million), Thai Baht ($12.2 million), Japanese Yen ($9.8 million), Kuwaiti Dinars ($3.5 million), and the sale of Euros ($19.0 million). The total fair value of these contracts was a net asset of approximately $3.9 million at June 30, 2017. The potential change in fair value for our outstanding contracts resulting from a hypothetical ten percent change in quoted foreign currency exchange rates would have been approximately $8.8 million and $6.3 million at June 30, 2017 and December 31, 2016, respectively. This potential change in fair value of our outstanding contracts would be offset by the change in fair value of the associated underlying operating exposures.

Other—The carrying values of our cash and cash equivalents (primarily consisting of bank deposits), accounts receivable and accounts payable approximate their fair values because of the short-term nature of these instruments. At June 30, 2017, the fair value of our Second Term Loan, based upon the current market rates for debt with similar credit risk and maturities, approximated its carrying value as interest is based upon LIBOR plus an applicable floating margin. At June 30, 2017, the fair values of our Senior Notes and Second Senior Notes, based upon the current market rates for debt with similar credit risk and maturities, approximated the carrying values due to their classification as current on our Balance Sheet. At December 31, 2016, our Senior Notes and Second Senior Notes had a total fair value of approximately $785.7 million and $206.4 million, respectively, based on current market rates for debt with similar credit risk and maturities and were categorized within level 2 of the valuation hierarchy. See Note 9 to our Financial Statements for additional discussion of our financial instruments.

Item 4. Controls and Procedures

Disclosure Controls and Procedures—For the period covered by this quarterly report on Form 10-Q, we carried out an evaluation, under the supervision and with the participation of our management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended). Based upon such evaluation, the CEO and CFO have concluded that, as of the end of such period, the design and operation of our disclosure controls and procedures are effective.

Changes in Internal Control—There were no changes in our internal controls over financial reporting that occurred during the second quarter2017, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

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PART II. OTHER INFORMATION

Item 1.Legal Proceedings

For information regarding ongoing litigation and other proceedings, see Note 11 to our Financial Statements in Part I of this report, which we incorporate by reference into this Item.

Item 1A. Risk Factors

We are subject to various risks and uncertainties in the course of our business.  A discussion of material risks and uncertainties relating to CB&I may be found under Item 1A-“Risk Factors” in Part I of our Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC on March 1, 2017 (the “Form 10-K Risk Factors”).  The following discussion supplements the Form 10-K Risk Factors.

Failure to comply with covenants in our Senior Facilities, which has previously required a series of waivers and amendments from our lenders or noteholders, could adversely affect our ability to borrow funds, issue letters of credit, result in the acceleration of our outstanding indebtedness, require us to cash collateralize outstanding letters of credit and otherwise adversely affect us.

Our Senior Facilities contain several financial covenants, with which we must comply.  Our recent operating and financial performance would have resulted in our being unable to satisfy certain of these covenants absent amendments and waivers from our lenders and debt holders.  We are entering into amendments to the Senior Facilities effective as of August 9, 2017 (subject to final documentation), which, among other things, will require us to comply with a new Minimum EBITDA covenant and a new Minimum Availability covenant and execute on our plans to take certain actions, including the suspension of quarterly dividends and the completion of the sale of our Technology Operations to a third party by December 27, 2017, subject to extension in certain events, and the repayment of outstanding indebtedness with proceeds from the sale.  As of June 30, 2017, our outstanding indebtedness was approximately $1.8 billion.  As certain factors regarding our compliance with our financial and other covenants contained in the Senior Facilities is beyond our control, approximately $1.2 billion of such debt, which by its terms is due beyond one year and would otherwise be reflected as long-term, has been classified as current. See the discussion above under “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources” within Item 2 of Part I.

There is a risk that we may not be able to satisfy the financial and other covenants under our Senior Facilities, as amended, without further negotiated amendments or waivers.  Our ability to comply with our financial and other covenants may be impacted by a variety of business, economic, legislative, financial and other factors which may be outside of our control, including those discussed above under “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources” within Item 2 of Part I. We can provide no assurance that any such further amendments or waivers would be obtained.  Further, our business and operations require us to spend large amounts of working capital for operating costs.  These working capital demands are sometimes made on short notice and sometimes without assurance of recovery of the expenditures. We have often satisfied these working capital and cash needs in the past by drawing on our revolving facilities.  If, in the future, we are unable to access those revolving credit facilities, it could compromise our ability to perform our work and could result in liquidity and contractual issues that could be material.

In the event that we are unable to satisfy our financial and other covenants under our Senior Facilities, as amended, and are unable to obtain any necessary amendments or waivers to avoid an event of default under any of the Senior Facilities, all of our outstanding indebtedness could be accelerated and our outstanding letters of credit could be required to be cash collateralized by us.  In those circumstances we may be unable to repay or refinance our outstanding indebtedness and replace or backstop the requirements with respect to our outstanding letters of credit.

We regularly use letters of credit and surety bonds in the ordinary course of our business.  To the extent that draws are made on letters of credit or advances are made under surety bonds, we may not be able to satisfy our repayment obligations.

In the ordinary course of our business, we obtain surety bonds and letters of credit, which we provide to our customers to secure advance payment or our performance under our contracts, or in lieu of retention being withheld on our contracts.  If a bank must advance a payment pursuant to a draw on a letter of credit due to our non-performance under a contract, such advance payment would constitute a borrowing under a credit facility and thus our direct obligation. Similarly, where a surety incurs such a loss, an indemnity agreement between the parties and us may require payment from our excess cash or a borrowing under our credit facilities.  To the extent that draws are made on letters of credit or advances are made under surety bonds, we may not be able to satisfy our repayment obligations.  If this were to occur and we were unable to negotiate an acceptable resolution with the various parties involved, we could  be in default under our Senior Facilities which, if uncured, could have one or more of the effects described in the discussion above.

In addition, a number of our letters of credits have one-year terms.  The issuing banks generally have no obligation to renew these letters of credit and, to the extent that particular letters of credit are not renewed, we will be required to find

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alternative letter of credit providers.  If we are unable to do so or do so on acceptable terms, we may be in breach of the underlying contracts with customers, and those customers may be entitled to terminate such contracts and claim related damages.  Depending on the materiality of the contracts involved, these circumstances could have a material adverse effect on our business, liquidity and financial condition.

The potential sale of our Technology Operations is subject to significant uncertainty and, if such sale does occur, it may not be consummated as quickly or on the terms that we currently anticipate.

On August 9, 2017, in conjunction with the amendments to our Senior Facilities, we announced that we are pursuing the potential sale of our Technology Operations to a third party.  We intend to use the net proceeds of such sale to repay outstanding indebtedness.  The potential sale of this business is subject to a number of factors and conditions outside of our control, and there can be no guarantee that the sale will be completed, or if completed, that the sale will generate the net cash proceeds required for us to remain in compliance with our financial and other covenants.   In addition, our announcement that we are pursuing the sale of our Technology Operations could disrupt its business and its relations with its employees, suppliers and customers, any or all of which could negatively impact its value.  Even if we are able to complete the Technology Sale, we may not be able to do so as quickly or on the terms that we currently anticipate which could result in an event of default under our Senior Facilities, as discussed above, and could otherwise have a material adverse effect on our business, liquidity and financial condition.

Our execution of fixed-price contracts has had, and may in the future continue to have, a negative impact on our operating results.

A significant portion of our contracts are at fixed prices. As a result, we bear the risk of cost overruns.  If we fail to price our contracts adequately, fail to estimate effectively the cost to complete fixed-price contracts or failure to execute such contracts at the cost estimates, or if we experience significant cost overruns, then our business, financial condition and liquidity could be materially and adversely affected. 

Item 6. Exhibits

(a) Exhibits

2.1(1)	Amendment Agreement, dated as of June 18, 2017, to the Purchase Agreement dated as of February 27, 2017 (incorporated by reference to Exhibit 10.1 to CB&I’s Current Report on Form 8-K filed with the SEC on July 7, 2017 (File No. 1-12815))
2.2(1)	Letter Amendment, dated as of June 30, 2017, to the Purchase Agreement dated as of February 27, 2017 (incorporated by reference to Exhibit 10.2 to CB&I’s Current Report on Form 8-K filed with the SEC on July 7, 2017 (File No. 1-12815), which filing omitted the schedules to the Letter Amendment pursuant to Item 601 (b) of Regulation S-K and noted that a copy of the omitted schedules will be furnished to the SEC supplementally upon request)
3(1)	Amended Articles of Association of the Company (English translation) (incorporated by reference to Exhibit 3 to CB&I’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2005, filed with the SEC on August 8, 2005 (File No. 1-12815))
10.1(2),(3)	Form of Restricted Stock Unit Award Letter pursuant to CB&I’s 2008 Long-Term Incentive Plan, as amended
10.2(2),(3)	Form of Performance Share Award Letter pursuant to CB&I’s 2008 Long-Term Incentive Plan, as amended
10.3(2),(3)	Amendment No. 2, dated as of June 22, 2017, to the Chicago Bridge & Iron Savings Plan
10.4(2),(3)	Amendment No. 3, dated as of June 30, 2017, to the Chicago Bridge & Iron Savings Plan
10.5(1)	Sixth Amendment and Waiver, dated as of May 8, 2017, to the Note Purchase and Guarantee Agreement dated as of December 27, 2012 (incorporated by reference to Exhibit 10.7 to CB&I’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, filed with the SEC on May 10, 2017 (File No. 1-12815))
10.6(1)	Amendment No. 6 and Waiver, dated as of May 8, 2017, to the Credit Agreement, dated as of October 28, 2013 (incorporated by reference to Exhibit 10.8 to CB&I’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, filed with the SEC on May 10, 2017 (File No. 1-12815))

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10.7(1)	Amendment No. 3 and Waiver, dated as of May 8, 2017, to the Amended and Restated Revolving Credit Agreement, dated as of July 8, 2015 (incorporated by reference to Exhibit 10.9 to CB&I’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, filed with the SEC on May 10, 2017 (File No. 1-12815))
10.8(1)	Amendment No. 3 and Waiver, dated as of May 8, 2017, to the Term Loan Agreement, dated as of July 8, 2015 (incorporated by reference to Exhibit 10.10 to CB&I’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, filed with the SEC on May 10, 2017 (File No. 1-12815))
10.9(1)	Fourth Amendment and Waiver, dated as of May 8, 2017, to the Note Purchase and Guarantee Agreement dated as of July 22, 2015 (incorporated by reference to Exhibit 10.11 to CB&I’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, filed with the SEC on May 10, 2017 (File No. 1-12815))
10.10(1)	Amendment No. 7, dated as of May 29, 2017, to the Credit Agreement, dated as of October 28, 2013 (incorporated by reference to Exhibit 10.1 to CB&I’s Current Report on Form 8-K filed with the SEC on June 2, 2017 (File No. 1-12815))
10.11(1)	Amendment No. 4, dated as of May 29, 2017, to the Amended and Restated Revolving Credit Agreement, dated as of July 8, 2015 (incorporated by reference to Exhibit 10.2 to CB&I’s Current Report on Form 8-K filed with the SEC on June 2, 2017 (File No. 1-12815))
10.12(1)	Amendment No. 4, dated as of May 29, 2017, to the Term Loan Agreement, dated as of July 8, 2015 (incorporated by reference to Exhibit 10.3 to CB&I’s Current Report on Form 8-K filed with the SEC on June 2, 2017 (File No. 1-12815))
10.13(1)	Separation and Release Agreement dated as of June 27, 2017 between Chicago Bridge & Iron Company (Delaware) and Philip K. Asherman (incorporated by reference to Exhibit 10.1 to CB&I’s Current Report on Form 8-K filed with the SEC on July 3, 2017 (File No. 1-12815))
31.1(3)	Certification of the Company’s Chief Executive Officer pursuant to Rule 13A-14 of the Securities Exchange Act of 1934 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2(3)	Certification of the Company’s Chief Financial Officer pursuant to Rule 13A-14 of the Securities Exchange Act of 1934 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1(3)	Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2(3)	Certification of the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS (3),(4)	XBRL Instance Document
101.SCH (3),(4)	XBRL Taxonomy Extension Schema Document
101.CAL (3),(4)	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF (3),(4)	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB (3),(4)	XBRL Taxonomy Extension Label Linkbase Document
101.PRE (3),(4)	XBRL Taxonomy Extension Presentation Linkbase Document

(1) Incorporated by reference to the filing indicated

(2) Management compensatory plan or arrangement

(3) Filed herewith

(4) Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2017 and 2016, (ii) the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2017 and 2016, (iii) the Condensed Consolidated Balance Sheets at June 30, 2017 and December 31, 2016, (iv) the Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016, (v) the Condensed Consolidated Statements of Changes in Shareholders’ Equity for the six months ended June 30, 2017 and 2016, and (vi) the Notes to Financial Statements.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on August 9, 2017.

Chicago Bridge & Iron Company N.V.
By:	Chicago Bridge & Iron Company B.V.
Its:	Managing Director
By:	/s/ Michael S. Taff
	Michael S. Taff
	Managing Director
	(Principal Financial Officer and Duly Authorized Officer)

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EX-10.1

Exhibit 10.1

Chicago Bridge & Iron Company

Agreement and Acknowledgment of 20XX Restricted Stock Unit Award

«Name»

This Agreement and Acknowledgment (the “Agreement”) between you and the Committee (the “Committee”) for the 2008 Long-Term Incentive Plan (the “Plan”) maintained by a subsidiary of Chicago Bridge & Iron Company N.V., a Netherlands corporation (the “Company”), states the terms of and your rights concerning the Restricted Stock Units (“Units”) hereby awarded to you pursuant to the Plan.

This Agreement is subject to the terms of the attached Plan (which is incorporated in this Agreement by this reference) which describes your rights and the conditions and limitations affecting those rights. Together, the Plan and this Agreement state all of the rights and obligations of the parties concerning this Restricted Stock Unit Award. Unless defined otherwise, all capitalized terms used in this Agreement shall have the same meaning as used in the Plan.

The award represented by this Agreement is not valid unless you sign and return the Agreement and Acknowledgement on the last page.

A.    Overview of Your Restricted Stock Units

1.    Number of Restricted Stock Units Granted:«RSU»

2.    Date of Grant:        <<Date of Grant>>

3.    Date(s) of Lapse of Period of Restrictions:

DatePercentage of Award Vesting

<<Vesting Date(s)>> <<Percentage Vesting on Such Date(s)>>

B.    Other Terms and Conditions

1.    Form of Award.

This is an award of Restricted Stock Units, with each Unit being a bookkeeping unit representing your right to be issued and to receive a common share (“Share”) of Chicago Bridge & Iron Company N.V. upon the lapse of risks of forfeiture and restrictions on each Unit during the Period of Restrictions specified in Section A above.

2.    Termination of Employment.

If your employment with the Company or any of its Subsidiaries or affiliated companies terminates during the Period of Restrictions, your Restricted Stock Units which are not then vested shall be forfeited as of the date of your termination of employment. Notwithstanding the foregoing, if that termination of employment is a result of death, Retirement (as defined below), Disability or dismissal for the convenience of the Company (other than involuntary termination of employment for willful misconduct or gross negligence, as it may be determined at the sole discretion of the Committee) during the Period of Restrictions, such Restricted Stock Units shall vest and become nonforfeitable and the Period of Restrictions shall terminate.

1 <<Date>> RSU Agreement-LTIP

For purposes of this Agreement, “Retirement” shall mean a termination of employment that is a “Retirement” as defined in the Plan for Awards granted on or after February 19, 2015, but only if such a termination of employment also is (i) not the result of, or undertaken to avoid, an involuntary termination of employment for willful misconduct or gross negligence, as may be determined at the sole discretion of the Committee, (ii) not to enable your taking employment with a company engaged in (A) offering licensed process technologies, catalysts, specialized equipment or engineered products for use in petrochemical facilities, oil refineries and/or gas processing plants, (B) providing engineering, procurement, fabrication, construction or maintenance services for energy infrastructure facilities, (C) providing piping, storage tanks or vessels for the oil and gas, water and wastewater, mining or power generation industries, (D) providing design-build infrastructure projects for federal, state or local governments, (E) providing design-build services for marine or transportation projects, (F) providing environmental services including remediation and restoration of contaminated sites, emergency response or disaster recovery for government and/or private sector clients, or (G) any business activity engaged in by the Company or its subsidiaries or affiliates during the Period of Restrictions; unless such employment has the prior written approval of the Committee, and (iii) upon advance written notice to the Committee and agreement on such terms and conditions which the Committee in its sole discretion deems appropriate to achieve a smooth transition of duties.

3.    Dividends and Voting.

If during the Period of Restrictions prior to a Vesting Date or forfeiture of Restricted Stock Units, the Company pays a dividend or distribution, whether paid in cash, equity securities in the Company, rights to acquire equity securities in the Company or any other property with respect to outstanding Shares (including, but not limited to, a share dividend to effect a stock split), then:

(a)with respect to share dividends or distributions to effect a stock split you will be credited with additional Restricted Stock Units equal to the product of (i) the Restricted Stock Units awarded hereby that have not been exchanged or settled by the Company for Shares, or forfeited, and (ii) the fair market value of the aggregate share dividend or distribution that would have been distributed with respect to the number of Shares issuable under the Restricted Stock Units awarded hereby that have not been exchanged, settled or forfeited, as determined by the Committee in its sole discretion, divided by (iii) the Fair Market Value of a Share on the date of such dividend or distribution. Each additional Restricted Stock Unit awarded under this Section will be subject to the same restrictions and terms and conditions of the Plan and this Agreement as the Restricted Stock Units with respect to which they were credited and will be exchanged or settled for cash or Shares, as determined by the Committee in its sole discretion, at the same time and on the same basis as such Restricted Stock Units; and

(b)    with respect to any other form of dividend or distribution you will be credited in an amount equivalent to the fair market value of such dividend or distribution paid with respect to Shares represented by the Restricted Stock Units which have been awarded to you and which have not been forfeited, which fair market value shall be determined by the Committee in its sole discretion. The Company will make a cash payment to you, in the form of compensation, in an amount equal to the total of such credits at the same time and on the same basis as such Restricted Stock Units.

You may not direct the voting of the Shares represented by the Restricted Stock Units during the Period of Restrictions until the Shares have been issued and you are informed that voting rights have been passed through to you.

2 <<Date>> RSU Agreement-LTIP

4.    Interpretation.

The Committee shall have the right to interpret the terms of this Agreement.

5.    Unit Restrictions.

The Restricted Stock Units awarded under this Agreement may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, whether voluntarily or involuntarily, by operation of law or otherwise, until the applicable Date(s) of Lapse of Period of Restrictions. If any assignment, pledge, transfer, or other disposition, voluntary or involuntary, of the Restricted Stock Units shall be made, or if any attachment, execution, garnishment, or lien shall be issued against or placed upon the Restricted Stock Units, before the applicable Date(s) of Lapse of Period of Restrictions, all Units not previously vested shall be forfeited as of the date of such pledge, transfer, disposition, attachment, execution, garnishment or lien.

The Shares issued in respect of Restricted Stock Units granted under this Agreement shall be freely transferable by you on the applicable Date(s) of Lapse of Period of Restrictions specified above. The Company will deliver to you (or if you have died, to your Beneficiary), in book entry form the Shares issued in respect of Units which have not been forfeited as soon as practicable after the Date(s) of Lapse of Period of Restrictions specified above.

6.    Change of Control Vesting Not Applicable.

Article 13 of the Plan (“Change of Control”) shall not apply to this Award unless the Award would otherwise terminate in the Change of Control. Accordingly, the restriction period and restrictions on this Restricted Stock Unit Award shall not lapse by reason of any event that is a Change of Control that does not otherwise terminate the Award.

If you have a separate agreement with the Company providing for the treatment of your Restricted Stock Units upon a Change of Control, that agreement will govern to the extent that treatment is more favorable to you than the provisions of this Section.

7.    Limitations of Other Law.

The Restricted Stock Units under this Agreement are intended either to be exempt from the restrictions of Section 409A of the Code as short term deferrals or to comply with those restrictions by providing for payment at a specified time or on a fixed schedule.

Nothwithstanding any provision of this Agreement to the contrary, if you are a “specified employee” within the meaning of Section 409(A) of the Code (“Section 409(A)”) as of the date of your termination of employment and the Company determines, in good faith, that immediate payments of any amounts or benefits would cause a violation of Section 409(A), then any amounts or benefits which are payable under this Award upon your “separation from service” within the meaning of Section 409(A) which (i) are subject to the provisions of Section 409(A); (ii) are not otherwise excluded under Section 409(A); and (iii) would otherwise be payable during the first six-month period following such separation from service shall be paid on the first business day next following the earlier of (1) the date that is six months and one day following your separation from service or (2) the date of your death.

In the event that applicable law of any jurisdiction may, as determined in the sole discretion of the Committee, limit, impede, restrict or prohibit any issuance of Restricted Stock Units

3 <<Date>> RSU Agreement-LTIP

pursuant to the Plan or this Agreement or any of their terms, then this Agreement shall, in the sole discretion of the Committee, be amended to the extent necessary, or rescinded, to comply with any such law.

Committee for the

2008 Long-Term Incentive Plan

Please acknowledge your designation by the Committee to participate in the Plan and this Agreement, and your agreement to abide by the provisions of the Plan as amended and this Agreement, by signing below and returning a copy of the entire agreement including this page to the attention of ________, Corporate Human Resources by ____________.

Agreement and Acknowledgment

By signing a copy of this Agreement and returning it to Corporate Human Resources, I acknowledge that I have read the Plan, and that I fully understand all of my rights under the Plan, as well as all of the terms and conditions which may limit my eligibility to receive and to vest in Restricted Stock. Without limiting the generality of the preceding sentence, I understand that my right to acquire Shares in respect of my Restricted Stock Units is conditioned upon my continued employment with Chicago Bridge & Iron Company or its eligible Subsidiaries or Affiliates through the end of the applicable Period of Restrictions as set forth above in this Agreement and the Plan.

«Name» - Participant

Date:

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EX-10.2

Exhibit 10.2

Chicago Bridge & Iron Company

Agreement and Acknowledgment of 20XX Performance Share Award

«Name»

This Agreement and Acknowledgment (the “Agreement”) between you and the Committee (the “Committee”) for the 2008 Long-Term Incentive Plan (the “Plan”) maintained by a subsidiary of Chicago Bridge & Iron Company N.V., a Netherlands corporation (the “Company”), states the terms of, and your rights concerning, the Performance Shares hereby awarded to you pursuant to the Plan.

This Agreement is subject to the terms of the attached Plan (which is incorporated in this Agreement by this reference) which describes your rights and the conditions and limitations affecting those rights. Together, the Plan and this Agreement state all of the rights and obligations of the parties concerning this Performance Share Award. Unless defined otherwise, all capitalized terms used in this Agreement shall have the same meaning as used in the Plan.

Overview of Your Performance Shares

A.    Total Number of Performance Shares Granted:«PS»

Your Performance Shares are subject to two separate Performance Targets:

(a) «EPS»,which is 80 percent (80%) of your Performance Shares, will be classified as “EPS Performance Shares” and will be earned based on EPS Performance Target outlined in Section D below.

(b) «RTSR», which is 20 percent (20%) of your Performance Shares, will be classified as “RTSR Performance Shares” and will be earned based on the RTSR Performance Target outlined in Section E below.

B.    Date of grant: __________

C.    Performance Periods:

Fiscal year ____

Fiscal year ____

Fiscal year ____

D.    Terms of EPS Performance Shares

1.    EPS Performance Target:

The EPS Performance Shares will be earned based on the EPS Performance Target, as described in this Section D. For this purpose, Earnings per Share shall be income from continuing operations per diluted share, excluding special charges, as reported to the Company’s shareholders (“EPS”) in each Performance Period as provided below under subparagraph (b) of “EPS Performance Share Adjustments.”

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2.    EPS Performance Share Adjustments:

(a)    The number of Performance Shares that may be earned for each Performance Period at the “target” level will be one-third of the number of EPS Performance Shares specified above under “Total Number of Performance Shares Granted.” You will be awarded that number of Shares at the end of the applicable Performance Period if EPS in that Performance Period equals Target EPS as defined in subparagraph (b) below.

(b)    If EPS in a Performance Period exceeds or falls short of Target EPS, you will be awarded a number of Shares at the end of that Performance Period determined under the following table by applying the “payout percentage” determined by Performance Period EPS to your target shares for such Performance Period, with the “payout percentage” for EPS between table amounts determined by linear interpolation.

EPS Range	Minimum	Target EPS	Maximum
Payout Percent	50%	100%	200%
EPS-XXXX	$	$	$
EPS-XXXX	$	$	$
EPS-XXXX	$	$	$

(c)    No Shares will be issued for any Performance Period if the EPS for that year is less than the minimum EPS designated for that year. No more than 200% of the number of target shares will be issued for any Performance Period if the EPS for that year is equal to or greater than the maximum EPS designated for that year.

3.    Vesting:

Shares earned based on EPS performance and not otherwise forfeited as provided below upon termination of employment are 100% vested as of the end of the applicable Performance Period.

E.    Terms of RTSR Performance Shares

1.    RTSR Performance Target:

The RTSR Performance Shares will be earned based on the RTSR Performance Target, as described in this Section E. Payment under this Award is determined based on performance using relative total shareholder return (“RTSR”). No portion of this Award will be earned if the Company’s performance during the applicable Performance Period is below the threshold level for RTSR Performance Target as described in subsection 2(b) below.

The Company’s RTSR shall be as measured against the FLM Global Engineering & Construction Company Index (the “FLM Index”). RTSR for the Company based on the FLM Index comparator group shall be calculated separately for each Performance Period (using a 30-day averaging period for the first 30 calendar days and the last 30 calendar days of the Performance Period to mitigate the effect of stock price volatility). The RTSR calculation shall assume reinvestment of dividends and shall reflect any changes to the FLM Index, as determined by its investment advisor.

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<<Date>> PS Agreement-LTIP

2.    RTSR Performance Share Adjustments:

(a)    The number of Performance Shares that may be earned for each Performance Period at the “target” level will be one-third of the number of RTSR Performance Shares specified above under “Total Number of Performance Shares Granted.” You will be awarded that number of Shares at the end of the applicable Performance Period if our RTSR in that Performance Period is equal to 100% of the Index Return, as described in subparagraph (b) below. For this purpose, “Index Return” shall be the value at the end of the Performance Period of a $100 investment in the FLM Index on the first day of the Performance Period.

(b)    If our RTSR in a Performance Period is above or below 100%, you will be awarded a number of Shares at the end of that Performance Period determined under the following table, with the “payout percentage” for RTSR between table amounts determined by linear interpolation.

Level	RTSR Performance Level	Payout Percentage
Maximum	120% of Index Return or more	200% of Target Level
Target	100% of Index Return	100% of Target Level
Threshold	80% of Index Return	50% of Target Level
Below Threshold	<80% of Index Return	0%

(c)    No Shares will be issued for any Performance Period if the RTSR for that year is less than 80% of the Index Return for that year. No more than 200% of the number of target Shares will be issued for any Performance Period if the RTSR for that year is equal to or greater than 120% of the Index Return for that year.

3.    Vesting:

Shares earned based on RTSR performance and not otherwise forfeited as provided below upon termination of employment are 100% vested as of the end of the applicable Performance Period.

F.    Other Terms and Conditions

1.Manner of Payment

Performance Shares that are earned and not otherwise forfeited as provided below upon termination of employment will be issued to you in book entry form (or cash in lieu of Shares paid to you) as soon as practicable after the Committee has certified the number of Performance Shares earned for the Performance Period and in all events by March 15 following the end of the applicable Performance Period.

3

<<Date>> PS Agreement-LTIP

2.    Termination of Employment

If your employment with the Company or any of its Subsidiaries or affiliated companies terminates during the Performance Period, your Performance Shares which are not then vested shall be forfeited as of the date of your termination of employment. Notwithstanding the foregoing:

(a)    If that termination of employment is a result of death, Disability, or Retirement (as defined below) during a Performance Period, then Performance Shares that are earned during that Performance Period and future Performance Periods covered by this Award, based on EPS and RTSR for those Performance Periods, shall vest and be awarded at the end of those Performance Periods upon certification by the Committee that Performance Shares are earned.

(b)    If that termination of employment is a result of dismissal for the convenience of the Company (other than involuntary termination of employment for willful misconduct or gross negligence, as it may be determined at the sole discretion of the Committee), then Performance Shares that are earned during the Performance Period in which termination of employment occurs, based on EPS and RTSR for that Performance Period, shall vest and be awarded as of the end of that Performance Period upon the certification by the Committee that Performance Shares are earned. All other Performance Shares for Performance Periods covered by this Award shall be forfeited.

For purposes of this Agreement, “Retirement” shall mean a termination of employment that is a “Retirement” as defined in the Plan for Awards granted on or after February 19, 2015, but only if such a termination of employment also is (i) not the result of, or undertaken to avoid, an involuntary termination of employment for willful misconduct or gross negligence, as may be determined at the sole discretion of the Committee, (ii) not to enable your taking employment with a company engaged in (A) offering licensed process technologies, catalysts, specialized equipment or engineered products for use in petrochemical facilities, oil refineries and/or gas processing plants, (B) providing engineering, procurement, fabrication, construction or maintenance services for energy infrastructure facilities, (C) providing piping, storage tanks or vessels for the oil and gas, water and wastewater, mining or power generation industries, (D) providing design-build infrastructure projects for federal, state or local governments, (E) providing design-build services for marine or transportation projects, (F) providing environmental services including remediation and restoration of contaminated sites, emergency response or disaster recovery for government and/or private sector clients, or (G) any business activity engaged in by the Company or its subsidiaries or affiliates during the Performance Period; unless such employment has the prior written approval of the Committee, and (iii) upon advance written notice to the Committee and agreement on such terms and conditions which the Committee in its sole discretion deems appropriate to achieve a smooth transition of duties.

3.Dividends and Voting

If Performance Shares are earned as of the end of a Performance Period and:

(a)If cash dividends are paid on such Shares after the end of the Performance Period but before the Shares are issued (or cash in lieu of Shares is paid) to you, then the Company will pay you at the time the Performance Shares are issued (or cash in lieu of Shares is paid) an amount equal to such cash dividends; and

4

<<Date>> PS Agreement-LTIP

(b)If dividends in Shares are paid on such Shares after the end of the Performance Period but before the Shares are issued (or cash in lieu of Shares is paid) to you, then the Company will issue you at the time the Performance Shares are issued (or cash in lieu of Shares is paid) additional Shares (or cash equal to the Fair Market Value of Shares as of the date immediately preceding the date of distribution) representing such dividends.

No Shares or cash amount will be issued or paid in respect of dividends paid during or before the end of the Performance Period in which the Performance Shares are earned. You may not direct the voting of Performance Shares unless and until the Shares have been actually issued to you following the applicable Performance Period.

4.    Interpretation and Adjustment

The Committee shall have the right to interpret the terms of this Agreement. The Committee shall have the right, in its sole discretion, to adjust the determinations of the degree of attainment of the EPS Performance Target and/or the RSTR Performance Target, as described in Sections D and E above, provided that the amount payable with respect to each such performance target may not be increased from the amount payable in the absence of any such adjustment.

5.    Share Restrictions

Shares issued to you shall not be restricted except for such limitations on transferability as may be imposed by applicable law.

6.Change of Control

The provisions of Article 13 of the Plan (“Change of Control”) will apply unless the Change of Control results from a Growth Transaction. A “Growth Transaction” is the issuance of Shares by the Company to a person (a “Transaction Owner”) as consideration for the purchase by the Company directly or indirectly of ownership interests or assets of a business or as part of an arrangement for financing the purchase by the Company directly or indirectly of ownership interests or assets of a business, or the sale of such Shares by a Transaction Owner (or a third party who acquired such Shares from the Transaction Owner) to another Transaction Owner or third party, provided in either case that the acquiring Transaction Owner or third party is subject to an agreement (a “Shareholder Agreement”) between the Company and such person that limits the ability of such person and its affiliates to obtain and exercise control over the management and policies of the Company. However, a “Growth Transaction” will not include any transaction that would remain a “Change in Control” as defined in Section 2.7 of the Plan if “66.5%” were substituted for “25%” in subsection 2.7(a) of the Plan. If a Growth Transaction occurs or has occurred, a Change of Control shall be deemed to occur if the acquiring Transaction Owner or third party materially breaches the Shareholder Agreement entered into in connection with the Growth Transaction.

If you have a separate agreement with the Company providing for the treatment of your Performance Shares upon a Change in Control, that agreement will govern to the extent that treatment is more favorable to you than the provisions of this Section.

7.Limitations of Other Law

The Performance Shares under this Agreement are intended to be exempt from the restrictions of Section 409A of the Code as short term deferrals.

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<<Date>> PS Agreement-LTIP

In the event that applicable law of any jurisdiction other than the United States and its possessions may, as determined in the sole discretion of the Committee, limit, impede, restrict or prohibit any issuance of Performance Shares pursuant to the Plan or this Agreement or any of their terms, or the full intent and purpose of any such Award, due to the location of your employment, residency or citizenship as of the date of this Agreement, then this Agreement shall, in the sole discretion of the Committee, be amended to the extent necessary, or rescinded, to comply with any such law.

Committee for the

2008 Long-Term Incentive Plan

Please acknowledge your designation by the Committee to participate in the Plan and this Agreement, and your agreement to abide by the provision of the Plan and this Agreement, by signing below and promptly returning a copy of the entire agreement including this page to the attention of ____________, Corporate Human Resources by _________________.

Agreement and Acknowledgment

By signing a copy of this Agreement and returning it to Chicago Bridge & Iron Company, I acknowledge that I have read this Agreement and the Plan, and that I fully understand all of my rights and obligations under this Agreement and the Plan, as well as all of the terms and conditions which may affect my receipt of Performance Shares. Without limiting the generality of the preceding sentence, I understand that my right to receive Performance Shares is conditioned upon my continued employment with Chicago Bridge & Iron Company or its eligible Subsidiaries or Affiliates through the end of the applicable Performance Period as set forth above in this Agreement and the Plan.

«Name» - Participant

Date:

6

<<Date>> PS Agreement-LTIP

EX-10.3

Exhibit 10.3

AMENDMENT NO. 2

TO THE

CHICAGO BRIDGE & IRON SAVINGS PLAN

Chicago Bridge & Iron Company (the "Company") maintains the Chicago Bridge & Iron Savings Plan (the " Plan") for the benefit of certain of its eligible employees.

The Plan has been amended from time to time and most recently was restated effective January 1, 2016. The Company now desires to further amend the Plan as follows:

1.    Consistent with Internal Revenue Service regulations, the Plan prohibits the application of forfeitures to fund safe harbor matching contributions. On January 18, 2017, the Internal Revenue Service issued proposed regulations lifting this restriction. The proposed regulations provide that such regulations may be relied upon prior to the date they are adopted in final form. Therefore, effective as of January 1, 2017, the Company desires to amend the Plan to permit the application of forfeitures to fund safe harbor matching contributions.

2.    Effective May 1, 2017, the Company desires to amend the Plan to prohibit new investments in Company stock.

3.    Prior to May 1, 2017, the Company imposed a limitation on the amount of Company stock that can be held by a participant in the Plan. Participants in the Plan were inadvertently able to exceed this Company stock limitation via participation in Advice Access, a Merrill Lynch product offered to Plan participants. The Internal Revenue Service has issued a compliance statement through its Voluntary Correction Program under Revenue Procedure 2013-12 to address this issue, and the correction thereunder requires a retroactive Plan amendment be adopted by July 19, 2017.

THEREFORE, effective as of the dates set forth below, the Plan shall be amended as follows:

A.    Effective as of January 1, 2017, Section 4.10 of the Plan is amended by deleting subsection (g) entirely and substituting the following:

(g)    Application of Forfeitures. Forfeitures arising pursuant to Sections 4.10(e), 5.01, 5.02(c), or 13.04 during a Plan Year shall be applied first to restore any Forfeitures that are reinstated during the Plan Year pursuant to Sections 4.10(f) or 13.04; second, to correct in such Plan Year any errors in the adjustment of Participants’ Accounts pursuant to Section 6.11, third, to the payment of expenses of administering the Plan and the Trust pursuant to Section 6.03, and fourth, toward the payment of Matching Contributions and/or Company Contributions, as determined by the Company. Forfeitures that are applied toward payment of Matching Contributions and/or Company Contributions shall be, as applicable, considered to be Matching Contributions and/or Company Contributions, shall reduce the amount of Matching Contributions and/or Company Contributions

otherwise required to be made to the Trust, and shall be allocated in accordance with Sections 4.02(c) and/or 4.03(c).

B.    Effective as of May 1, 2017, the Plan is amended by adding the following provision:

Notwithstanding any other Plan provision to the contrary, effective May 1, 2017, the Company Stock Fund is frozen; no new contributions or rollovers to the Plan may be invested in the Company Stock Fund and no amounts may be transferred from any other Investment Fund into the Company Stock Fund.

C.    Effective as of January 1, 2016, subsection 6.08(b) of the Plan is amended by adding the following provision:

Notwithstanding anything in the Plan to the contrary, the limitation on the amount of Company Stock a Participant can hold shall not apply to the extent that such limit was exceeded as a result of a Participant’s election made before July 16, 2016 to participate in the investment advisory service called “Advice Access” provided by Merrill Lynch, if such limit was exceeded by the Participant overriding an Advice Access asset allocation recommendation by adding Company Stock to the asset allocation and holding some Company Stock outside such program.

IN WITNESS WHEREOF, the Company has caused this Amendment to be executed this 22nd day of June, 2017.

CHICAGO BRIDGE & IRON COMPANY:

Signature: /s/ Michael S. Taff

Print Name: Michael S. Taff

Title/Position: EVP and CFO

2

EX-10.4

Exhibit 10.4

AMENDMENT NO. 3

TO THE

CHICAGO BRIDGE & IRON SAVINGS PLAN

Chicago Bridge & Iron Company (the "Company") maintains the Chicago Bridge & Iron Savings Plan (the " Plan") for the benefit of certain of its eligible employees. The Plan has been amended from time to time and most recently was restated effective January 1, 2016.

On the Closing Date (as defined in a Purchase Agreement by and among Chicago Bridge & Iron Company N.V., The Shaw Group Inc., CBI Peruana SAC, Horton CBI, Limited and CSVC Acquisition Corp. dated February 27, 2017), CSVC Acquisition Corp. shall purchase all of the outstanding stock of the entities identified in the Purchase Agreement as the “Capital Services Group”. The Company now desires to amend the Plan effective as of the day prior to the Closing Date to:

1.    exclude from the definition of Eligible Employee each participant who, as a result of the acquisition, is terminated from the Capital Services Group on the Closing Date; and

2.    provide for full vesting of the Plan accounts of each participant who, as a result of the acquisition, is terminated from the Capital Services Group on the Closing Date.

THEREORE, effective as of the day preceding the Closing Date, the Plan shall be amended as follows:

A.    Section 2.19 of the Plan is amended by adding the following subsection (i):

(i)    Effective as of the day prior to the Closing Date (as defined in a Purchase Agreement by and among Chicago Bridge & Iron Company N.V., The Shaw Group Inc., CBI Peruana SAC, Horton CBI, Limited and CSVC Acquisition Corp. dated February 27, 2017) (the “Purchase Agreement”), each Participant who:

(i)    is identified as an employee of the Capital Services Group (as defined in the Purchase Agreement); and

(ii)    as a result of the acquisition, terminates employment with the Capital Services Group on the Closing Date.

B.    Section 4.10 of the Plan is amended by adding the following provision:

Effective as of the day prior to the Closing Date (as defined in the Purchase Agreement described in Section 2.19), the Accounts of each Participant who:

(a)    is identified as an employee of the Capital Services Group (as defined in the Purchase Agreement); and

(b)    as a result of the acquisition, terminates employment with the Capital Services Group on the Closing Date;

shall be fully vested and nonforfeitable.

IN WITNESS WHEREOF, the Company has caused this Amendment to be executed this 30th day of June, 2017.

CHICAGO BRIDGE & IRON COMPANY:

Signature: /s/ Michael S. Taff

Print Name: Michael S. Taff

Title/Position: EVP and CFO

2

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULE 13A-14 OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Patrick K. Mullen, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Chicago Bridge & Iron Company N.V.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Patrick K. Mullen            

Patrick K. Mullen

Principal Executive Officer

Date: August 9, 2017

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULE 13A-14 OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael S. Taff, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Chicago Bridge & Iron Company N.V.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Michael S. Taff            

Michael S. Taff

Principal Financial Officer

Date: August 9, 2017

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of Chicago Bridge & Iron Company N.V. (the “Company”) on Form 10-Q for the period ending June 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Patrick K. Mullen, Principal Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Patrick K. Mullen            

Patrick K. Mullen

Principal Executive Officer

Date: August 9, 2017

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of Chicago Bridge & Iron Company N.V. (the “Company”) on Form 10-Q for the period ending June 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael S. Taff, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Michael S. Taff

Michael S. Taff

Principal Financial Officer

Date: August 9, 2017

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DOCUMENT AND ENTITY INFORMATION - shares	6 Months Ended
	Jun. 30, 2017	Jul. 27, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	CHICAGO BRIDGE & IRON CO N V
Trading Symbol	CBI
Entity Central Index Key	0001027884
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		101,169,452

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Statement [Abstract]
Revenue	$ 1,283,477	$ 2,161,164	$ 3,110,829	$ 4,295,793
Cost of revenue	1,661,534	1,903,209	3,337,935	3,782,268
Gross (loss) profit	(378,057)	257,955	(227,106)	513,525
Selling and administrative expense	67,167	69,195	140,224	150,141
Intangibles amortization	6,377	6,464	12,863	13,541
Equity earnings	(8,655)	(2,059)	(16,266)	(5,664)
Other operating expense, net	3,637	1,107	3,668	927
Operating (loss) income from continuing operations	(446,583)	183,248	(367,595)	354,580
Interest expense	(34,714)	(20,196)	(58,815)	(40,261)
Interest income	882	2,754	2,110	4,934
(Loss) income from continuing operations before taxes	(480,415)	165,806	(424,300)	319,253
Income tax benefit (expense)	178,752	(41,937)	165,048	(81,461)
Net (loss) income from continuing operations	(301,663)	123,869	(259,252)	237,792
Net (loss) income from discontinued operations	(120,847)	8,679	(111,353)	14,718
Net (loss) income	(422,510)	132,548	(370,605)	252,510
Less: Net income attributable to noncontrolling interests ($457, $437, $870 and $885 related to discontinued operations)	(2,909)	(8,709)	(30,159)	(21,746)
Net (loss) income attributable to CB&I	$ (425,419)	$ 123,839	$ (400,764)	$ 230,764
Net (loss) income attributable to CB&I per share (Basic):
(Loss) income from continuing operations, per basic share	$ (3.02)	$ 1.10	$ (2.87)	$ 2.07
(Loss) income from discontinued operations and disposal of discontinued operations, net of tax, per basic share	(1.20)	0.08	(1.11)	0.13
Basic (in dollars per share)	(4.22)	1.18	(3.98)	2.20
Net (loss) income attributable to CB&I per share (Diluted):
(Loss) income from continuing operations, per diluted share	(3.02)	1.09	(2.87)	2.05
(Loss) income from discontinued operations and disposal of discontinued operations, net of tax, per diluted share	(1.20)	0.08	(1.11)	0.13
Diluted (in dollars per share)	$ (4.22)	$ 1.17	$ (3.98)	$ 2.18
Weighted average shares outstanding:
Basic (in shares)	100,866	105,298	100,660	105,051
Diluted (in shares)	100,866	106,091	100,660	105,925
Cash dividends on shares:
Amount	$ 7,062	$ 7,372	$ 14,109	$ 14,731
Per share (in dollars per share)	$ 0.07	$ 0.07	$ 0.14	$ 0.14

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Statement [Abstract]
Net income (loss) related to discontinued operations	$ 457	$ 437	$ 870	$ 885

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Net (loss) income	$ (422,510)	$ 132,548	$ (370,605)	$ 252,510
Other comprehensive income (loss) from continuing operations, net of tax:
Change in unrealized fair value of cash flow hedges			810	1,043
Change in unrecognized prior service pension credits/costs			(20)	(156)
Change in unrecognized actuarial pension gains/losses			(8,045)	2,416
Comprehensive (loss) income	(395,920)	113,013	(320,266)	254,844
Net income attributable to noncontrolling interests ($457, $437, $870 and $885 related to discontinued operations)	(2,909)	(8,709)	(30,159)	(21,746)
Change in cumulative translation adjustment attributable to noncontrolling interests	(651)	713	(1,621)	(544)
Comprehensive (loss) income attributable to CB&I	(399,480)	105,017	(352,046)	232,554
Continuing Operations [Member]
Other comprehensive income (loss) from continuing operations, net of tax:
Change in cumulative translation adjustment	32,914	(23,691)	57,324	(1,232)
Change in unrealized fair value of cash flow hedges	457	(260)	810	1,043
Change in unrecognized prior service pension credits/costs	56	(183)	(20)	(156)
Change in unrecognized actuarial pension gains/losses	(6,612)	4,569	(8,045)	2,416
Discontinued Operations, Held-for-sale [Member]
Other comprehensive income (loss) from continuing operations, net of tax:
Change in cumulative translation adjustment	$ (225)	$ 30	$ 270	$ 263

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Comprehensive Income [Abstract]
Net income (loss) related to discontinued operations	$ 457	$ 437	$ 870	$ 885

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2017		Dec. 31, 2016
Assets
Cash and cash equivalents ($188,408 and $328,387 related to variable interest entities (VIEs))	$ 354,920		$ 490,679
Accounts receivable, net ($51,900 and $53,159 related to VIEs)	663,141		488,513
Inventory	158,818		190,102
Costs and estimated earnings in excess of billings ($6,263 and $26,186 related to VIEs)	418,038		410,749
Current assets of discontinued operations	0		414,732
Other current assets ($357,635 and $426,515 related to VIEs)	477,530		546,977
Total current assets	2,072,447		2,541,752
Equity investments	174,561		165,256
Property and equipment, net	502,426		505,944
Goodwill	2,829,214	[1]	2,813,803
Other intangibles, net	208,388		219,409
Deferred income taxes	876,969		730,108
Non-current assets of discontinued operations	0		462,144
Other non-current assets ($73,865 and $5,484 related to VIEs)	482,274		401,004
Total assets	7,146,279		7,839,420
Liabilities
Revolving facility and other short-term borrowings	374,000		407,500
Current maturities of long-term debt, net	1,469,320		503,910
Accounts payable ($353,343 and $337,089 related to VIEs)	976,929		964,548
Billings in excess of costs and estimated earnings ($441,481 and $407,325 related to VIEs)	1,704,464		1,395,349
Current liabilities of discontinued operations	0		247,469
Other current liabilities	953,567		1,017,473
Total current liabilities	5,478,280		4,536,249
Long-term debt, net	0		1,287,923
Deferred income taxes	8,937		7,307
Non-current liabilities of discontinued operations	0		5,388
Other non-current liabilities	438,852		441,216
Total liabilities	5,926,069		6,278,083
Shareholders’ Equity
Common stock, Euro .01 par value; shares authorized: 250,000; shares issued: 108,857 and 108,857; shares outstanding: 101,001 and 100,113	1,288		1,288
Additional paid-in capital	758,192		782,130
Retained earnings	955,733		1,370,606
Treasury stock, at cost: 7,856 and 8,744 shares	(296,351)		(344,870)
Accumulated other comprehensive loss	(346,898)		(395,616)
Total CB&I shareholders’ equity	1,071,964		1,413,538
Noncontrolling interests ($0 and $6,874 related to discontinued operations)	148,246		147,799
Total shareholders’ equity	1,220,210		1,561,337
Total liabilities and shareholders’ equity	$ 7,146,279		$ 7,839,420

[1] At June 30, 2017, we had approximately $453,100 of cumulative impairment losses which were recorded in our Engineering & Construction operating group during 2015 related to the sale of our nuclear power construction business (our “Nuclear Operations”) on December 31, 2015.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands	Jun. 30, 2017 USD ($) shares	Jun. 30, 2017 € / shares	Dec. 31, 2016 USD ($) shares	Dec. 31, 2016 € / shares
Cash and cash equivalents related to VIEs	$ 354,920		$ 490,679
Accounts receivable, net related to VIEs	663,141		488,513
Costs and estimated earnings in excess of billings related to VIEs	418,038		410,749
Other current assets related to VIEs	477,530		546,977
Other non-current assets to VIEs	482,274		401,004
Accounts payable related to VIEs	976,929		964,548
Billings in excess of costs and estimated earnings related to VIEs	$ 1,704,464		$ 1,395,349
Common stock, par value (Euro per share) | € / shares		€ 0.01		€ 0.01
Common stock, shares authorized (in shares) | shares	250,000,000		250,000,000
Common stock, shares issued (in shares) | shares	108,857,000		108,857,000
Common stock, shares outstanding (in shares) | shares	101,001,000		100,113,000
Treasury stock, shares (in shares) | shares	7,856,000		8,744,000
Noncontrolling interests of discontinued operations	$ 0		$ 6,874
Variable Interest Entity, Primary Beneficiary
Cash and cash equivalents related to VIEs	188,408		328,387
Accounts receivable, net related to VIEs	51,900		53,159
Costs and estimated earnings in excess of billings related to VIEs	6,263		26,186
Other current assets related to VIEs	357,635		426,515
Other non-current assets to VIEs	73,865		5,484
Accounts payable related to VIEs	353,343		337,089
Billings in excess of costs and estimated earnings related to VIEs	$ 441,481		$ 407,325

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash Flows from Operating Activities
Net (loss) income	$ (370,605)	$ 252,510
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	48,898	62,853
Loss On Net Assets Sold Net Of Transaction Cost	60,117	0
Loss on net assets sold (net of cash paid for transaction costs of $4,700)	4,700
Deferred income taxes	(141,866)	68,932
Stock-based compensation expense	26,441	21,275
Other operating expense, net	1,644	934
Unrealized (gain) loss on foreign currency hedges	(3,687)	2,863
Excess tax benefits from stock-based compensation	0	(46)
Changes in operating assets and liabilities:
Increase in receivables, net	(164,655)	(113,662)
Change in contracts in progress, net	298,677	87,405
Decrease in inventory	32,988	15,334
Decrease in accounts payable	(57,913)	(53,637)
Increase in other current and non-current assets	(42,502)	(12,764)
Decrease in other current and non-current liabilities	(127,972)	(22,878)
(Increase) decrease in equity investments	(140)	445
Change in other, net	(25,535)	9,700
Net cash (used in) provided by operating activities	(466,110)	319,264
Cash Flows from Investing Activities
Proceeds from sale of discontinued operation, net of cash sold	645,506	0
Capital expenditures	(34,300)	(25,276)
Advances With Partners Of Proportionately Consolidated Ventures, Net	50,384	(39,116)
Proceeds from sale of property and equipment	1,609	4,302
Other, net	(9,858)	(55,578)
Net cash provided by (used in) investing activities	653,341	(115,668)
Cash Flows from Financing Activities
Revolving facility and other short-term repayments, net	(33,500)	(181,000)
Advances with equity method and proportionately consolidated ventures, net	11,817	161,698
Repayments on long-term debt	(318,750)	(75,000)
Excess tax benefits from stock-based compensation	0	46
Purchase of treasury stock	(9,080)	(7,970)
Issuance of stock	7,176	8,864
Dividends paid	(14,109)	(14,731)
Distributions to noncontrolling interests	(24,298)	(29,643)
Revolving facility and deferred financing costs	(13,763)	0
Net cash used in financing activities	(394,507)	(137,736)
Effect of exchange rate changes on cash and cash equivalents	57,040	(13,169)
(Decrease) increase in cash and cash equivalents	(150,236)	52,691
Cash and cash equivalents. beginning of period	505,156	550,221
Cash and cash equivalents, end of period	354,920	602,912
Cash and cash equivalents, end of period - discontinued operations	0	(16,596)
Cash and cash equivalents, end of period	$ 354,920	$ 586,316

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive (Loss) Income [Member]	Noncontrolling Interests [Member]
Beginning Balance (in shares) at Dec. 31, 2015		104,427			4,430
Beginning Balance at Dec. 31, 2015	$ 2,163,590	$ 1,288	$ 800,641	$ 1,712,508	$ (206,407)	$ (294,040)	$ 149,600
Increase (Decrease) in Stockholders' Equity
Net (loss) income	252,510			230,764			21,746
Change in cumulative translation adjustment, net	(969)					(1,513)	544
Change in unrealized fair value of cash flow hedges, net	1,043					1,043
Change in unrecognized prior service pension credits/costs, net	(156)					(156)
Change in unrecognized actuarial pension gains/losses, net	2,416					2,416
Distributions to noncontrolling interests	(29,643)						(29,643)
Dividends paid ($0.07 per share, in 2017 and 2016)	(14,731)			(14,731)
Stock-based compensation expense	21,275		21,275
Purchase of treasury stock (in shares)		(237)			237
Purchase of treasury stock	(7,970)				$ (7,970)
Issuance of stock (in shares)		1,125			(1,125)
Issuance of stock	2,598		(49,573)		$ 52,171
Ending Balance (in shares) at Jun. 30, 2016		105,315			3,542
Ending Balance at Jun. 30, 2016	2,389,963	$ 1,288	772,343	1,928,541	$ (162,206)	(292,250)	142,247
Beginning Balance (in shares) at Dec. 31, 2016		100,113			8,744
Beginning Balance at Dec. 31, 2016	1,561,337	$ 1,288	782,130	1,370,606	$ (344,870)	(395,616)	147,799
Increase (Decrease) in Stockholders' Equity
Net (loss) income	(370,605)			(400,764)			30,159
Disposition	(7,035)						(7,035)
Change in cumulative translation adjustment, net	57,594					55,973	1,621
Change in unrealized fair value of cash flow hedges, net	810					810
Change in unrecognized prior service pension credits/costs, net	(20)					(20)
Change in unrecognized actuarial pension gains/losses, net	(8,045)					(8,045)
Distributions to noncontrolling interests	(24,298)						(24,298)
Dividends paid ($0.07 per share, in 2017 and 2016)	(14,109)			(14,109)
Stock-based compensation expense	26,441		26,441
Purchase of treasury stock (in shares)		(299)			299
Purchase of treasury stock	(9,080)				$ (9,080)
Issuance of stock (in shares)		1,187			(1,187)
Issuance of stock	7,220		(50,379)		$ 57,599
Ending Balance (in shares) at Jun. 30, 2017		101,001			7,856
Ending Balance at Jun. 30, 2017	$ 1,220,210	$ 1,288	$ 758,192	$ 955,733	$ (296,351)	$ (346,898)	$ 148,246

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Stockholders' Equity [Abstract]
Dividends paid (in dollars per share)	$ 0.07	$ 0.07	$ 0.14	$ 0.14

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ORGANIZATION AND NATURE OF OPERATIONS

6 Months Ended

Jun. 30, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND NATURE OF OPERATIONS

ORGANIZATION AND NATURE OF OPERATIONS

Organization and Nature of Operations—Founded in 1889, Chicago Bridge & Iron Company N.V. (“CB&I”, “we”, “our” or “us”) provides a wide range of services, including conceptual design, technology, engineering, procurement, fabrication, modularization, construction and commissioning services to customers in the energy infrastructure market throughout the world. Our business is aligned into three operating groups, which represent our reportable segments: Engineering & Construction; Fabrication Services; and Technology. See Note 2 and Note 4 for discussions of our discontinued operations and Note 15 for a discussion of our reportable segments and related financial information.

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SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting and Consolidation—The accompanying unaudited interim Condensed Consolidated Financial Statements (“Financial Statements”) are prepared in accordance with the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (the “SEC”) and accounting principles generally accepted in the United States of America (“U.S. GAAP”). These Financial Statements include all wholly-owned subsidiaries and those entities which we are required to consolidate. See the “Partnering Arrangements” section of this footnote for further discussion of our consolidation policy for those entities that are not wholly-owned. Intercompany balances and transactions are eliminated in consolidation.

Basis of Presentation—We believe these Financial Statements include all adjustments, which are of a normal recurring nature, necessary for a fair presentation of our results of operations for the three and six months ended June 30, 2017 and 2016, our financial position as of June 30, 2017 and our cash flows for the six months ended June 30, 2017 and 2016. The December 31, 2016 Condensed Consolidated Balance Sheet (the “Balance Sheet”) was derived from our December 31, 2016 audited Consolidated Balance Sheet, adjusted to conform to our current year presentation.

On February 27, 2017, we entered into a definitive agreement (the “CS Agreement”) with CSVC Acquisition Corp (“CSVC”), under which CSVC agreed to acquire our capital services operations, which are primarily comprised of our former Capital Services reportable segment and provides comprehensive and integrated maintenance services, environmental engineering and remediation, construction services, program management, and disaster response and recovery services for private-sector customers and governments (the “Capital Services Operations”). We completed the sale of our Capital Services Operations on June 30, 2017 (the “Closing Date”). We considered the Capital Services Operations to be a discontinued operation in the first quarter 2017, as the divestiture represented a strategic shift and will have a material effect on our operations and financial results. Operating results of the Capital Services Operations have been classified as a discontinued operation within the Condensed Consolidated Statements of Operations (the “Statement of Operations”) for the three and six months ended June 30, 2017 and 2016. Further, the assets and liabilities of the Capital Services Operations have been classified as assets and liabilities of discontinued operations within our December 31, 2016 Balance Sheet, and our June 30, 2017 Balance Sheet reflects the impact of the sale. Cash flows of the Capital Services Operations are not reported separately within our Condensed Consolidated Statements of Cash flows. Unless otherwise noted, the footnotes to our Financial Statements relate to our continuing operations. See Note 4 for additional discussion of our discontinued operations and the impact of the sale of the Capital Services Operations.

In July 2017, we initiated a plan to market and sell our Technology operations (primarily comprised of our Technology reportable segment) and Engineered Products operations (representing a portion of our Fabrication Services reportable segment) (collectively, the “Technology Operations”), the proceeds of which will be used to significantly reduce our outstanding debt. We anticipate classifying the Technology Operations as held for sale during the third quarter 2017.

We believe the disclosures accompanying these Financial Statements are adequate to make the information presented not misleading. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC for interim reporting periods. The results of operations and cash flows for the interim periods are not necessarily indicative of the results to be expected for the full year. The accompanying Financial Statements should be read in conjunction with our Consolidated Financial Statements and notes thereto included in our 2016 Annual Report on Form 10-K (“2016 Annual Report”).

Use of Estimates—The preparation of our Financial Statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. We believe the most significant estimates and judgments are associated with revenue recognition for our contracts, including estimating costs and the recognition of incentive fees and unapproved change orders and claims; fair value and recoverability assessments that must be periodically performed with respect to long-lived tangible assets, goodwill and other intangible assets; valuation of deferred tax assets and financial instruments; the determination of liabilities related to self-insurance programs and income taxes; and consolidation determinations with respect to our partnering arrangements. If the underlying estimates and assumptions upon which our Financial Statements are based change in the future, actual amounts may differ from those included in the accompanying Financial Statements.

Revenue Recognition—Our revenue is primarily derived from long-term contracts and is generally recognized using the percentage of completion (“POC”) method, primarily based on the percentage that actual costs-to-date bear to total estimated costs to complete each contract. We follow the guidance of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Revenue Recognition Topic 605-35 for accounting policies relating to our use of the POC method, estimating costs, and revenue recognition, including the recognition of incentive fees, unapproved change orders and claims, and combining and segmenting contracts. We primarily utilize the cost-to-cost approach to estimate POC as we believe this method is less subjective than relying on assessments of physical progress. Under the cost-to-cost approach, the use of estimated costs to complete each contract is a significant variable in the process of determining recognized revenue and is a significant factor in the accounting for contracts. Significant estimates that impact the cost to complete each contract are costs of engineering, materials, components, equipment, labor and subcontracts; labor productivity; schedule durations, including subcontractor or supplier progress; liquidated damages; contract disputes, including claims; achievement of contractual performance requirements; and contingency, among others. The cumulative impact of revisions in total cost estimates during the progress of work is reflected in the period in which these changes become known, including, to the extent required, the reversal of profit recognized in prior periods and the recognition of losses expected to be incurred on contracts in progress. Due to the various estimates inherent in our contract accounting, actual results could differ from those estimates. See Note 14 for discussion of projects with significant changes in estimated margins during the three and six months ended June 30, 2017 and 2016.

Our long-term contracts are awarded on a competitively bid and negotiated basis and the timing of revenue recognition may be impacted by the terms of such contracts. We use a range of contracting options, including cost-reimbursable, fixed-price and hybrid, which has both cost-reimbursable and fixed-price characteristics. Fixed-price contracts, and hybrid contracts with a more significant fixed-price component, tend to provide us with greater control over project schedule and the timing of when work is performed and costs are incurred, and accordingly, when revenue is recognized. Cost-reimbursable contracts, and hybrid contracts with a more significant cost-reimbursable component, generally provide our customers with greater influence over the timing of when we perform our work, and accordingly, such contracts often result in less predictability with respect to the timing of revenue recognition. Contract revenue for our long-term contracts recognized under the POC method reflects the original contract price adjusted for approved change orders and estimated recoveries for incentive fees, unapproved change orders and claims, and liquidated damages. We recognize revenue associated with incentive fees when the value can be reliably estimated and recovery is probable. We recognize revenue associated with unapproved change orders and claims to the extent the related costs have been incurred, the value can be reliably estimated and recovery is probable. Our recorded incentive fees, unapproved change orders and claims reflect our best estimate of recovery amounts; however, the ultimate resolution and amounts received could differ from these estimates. Liquidated damages are reflected as a reduction to contract price to the extent they are deemed probable. See Note 14 for additional discussion of our recorded unapproved change orders, claims and incentives.

With respect to our engineering, procurement, and construction (“EPC”) services, our contracts are not segmented between types of services, such as engineering and construction, if each of the EPC components is negotiated concurrently or if the pricing of any such services is subject to the ultimate negotiation and agreement of the entire EPC contract. However, an EPC contract including technology or fabrication services may be segmented if we satisfy the segmenting criteria in ASC 605-35. Revenue recorded in these situations is based on our prices and terms for similar services to third party customers. Segmenting a contract may result in different interim rates of profitability for each scope of service than if we had recognized revenue without segmenting. In some instances, we may combine contracts that are entered into in multiple phases, but are interdependent and include pricing considerations by us and the customer that are impacted by all phases of the project. Otherwise, if each phase is independent of the other and pricing considerations do not give effect to another phase, the contracts will not be combined.

Cost of revenue for our long-term contracts includes direct contract costs, such as materials and labor, and indirect costs that are attributable to contract activity. The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Projects with costs and estimated earnings recognized to date in excess of cumulative billings is reported on the Balance Sheet as costs and estimated earnings in excess of billings. Projects with cumulative billings in excess of costs and estimated earnings recognized to date is reported on the Balance Sheet as billings in excess of costs and estimated earnings. The net balances on our Balance Sheet are collectively referred to as Contracts in Progress, net and the components of these balances at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017						December 31, 2016
	Asset			Liability			Asset			Liability
Costs and estimated earnings on contracts in progress	$	4,334,524		$	28,697,752		$	8,466,638		$	23,408,316
Billings on contracts in progress	(3,916,486		)	(30,402,216		)	(8,055,889		)	(24,803,665		)
Contracts in progress, net	$	418,038		$	(1,704,464	)	$	410,749		$	(1,395,349	)

Any uncollected billed amounts, including contract retentions, are reported as accounts receivable. At June 30, 2017 and December 31, 2016, accounts receivable included contract retentions of approximately $64,500 and $72,100, respectively. Contract retentions due beyond one year were approximately $46,600 and $37,500 at June 30, 2017 and December 31, 2016, respectively.

Revenue for our service contracts that do not satisfy the criteria for revenue recognition under the POC method is recorded at the time services are performed. Revenue associated with incentive fees for these contracts is recognized when earned. Unbilled receivables for our service contracts are recorded within accounts receivable and were approximately $9,600 and $16,100 at June 30, 2017 and December 31, 2016, respectively.

Revenue for our pipe and steel fabrication and catalyst manufacturing contracts that are independent of an EPC contract, or for which we satisfy the segmentation criteria discussed above, is recognized upon shipment of the fabricated or manufactured units. During the fabrication or manufacturing process, all related direct and allocable indirect costs are capitalized as work in process inventory and such costs are recorded as cost of revenue at the time of shipment.

Our billed and unbilled revenue may be exposed to potential credit risk if our customers should encounter financial difficulties, and we maintain reserves for specifically-identified potential uncollectible receivables. At June 30, 2017 and December 31, 2016, our allowances for doubtful accounts were not material.

Other Operating Expense (Income), Net—Other operating expense (income), net generally represents (gains) losses associated with the sale or disposition of property and equipment. For the three and six months ended June 30, 2017, other operating (income) expense, net also included accrued future operating lease expense for vacated facility capacity where we remain contractually obligated to a lessor of approximately $3,000.

Recoverability of Goodwill—Goodwill is not amortized to earnings, but instead is reviewed for impairment at least annually at a reporting unit level, absent any indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based upon balances as of October 1. We identify a potential impairment by comparing the fair value of the applicable reporting unit to its net book value, including goodwill. If the net book value exceeds the fair value of the reporting unit, an indication of potential impairment exists, and we measure the impairment by comparing the carrying value of the reporting unit’s goodwill to its implied fair value. To determine the fair value of our reporting units and test for impairment, we utilize an income approach (discounted cash flow method) as we believe this is the most direct approach to incorporate the specific economic attributes and risk profiles of our reporting units into our valuation model. This is consistent with the methodology used to determine the fair value of our reporting units in previous years. We generally do not utilize a market approach given the lack of relevant information generated by market transactions involving comparable businesses. However, to the extent market indicators of fair value become available, we consider such market indicators in our discounted cash flow analysis and determination of fair value. See Note 6 for additional discussion of our goodwill.

Recoverability of Other Long-Lived Assets—We amortize our finite-lived intangible assets on a straight-line basis with lives ranging from 6 to 20 years, absent any indicators of impairment. We review tangible assets and finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If a recoverability assessment is required, the estimated future cash flow associated with the asset or asset group will be compared to their respective carrying amounts to determine if an impairment exists. See Note 6 for additional discussion of our intangible assets.

Earnings Per Share (“EPS”)—Basic EPS is calculated by dividing net income attributable to CB&I by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the assumed conversion of dilutive securities, consisting of restricted shares, performance based shares (where performance criteria have been met), stock options and directors’ deferred-fee shares. See Note 3 for calculations associated with basic and diluted EPS.

Cash Equivalents—Cash equivalents are considered to be highly liquid securities with original maturities of three months or less.

Inventory—Inventory is recorded at the lower of cost and net realizable value and cost is determined using the first-in-first-out or weighted-average cost method. The cost of inventory includes acquisition costs, production or conversion costs, and other costs incurred to bring the inventory to a current location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. An allowance for excess or inactive inventory is recorded based upon an analysis that considers current inventory levels, historical usage patterns, estimates of future sales expectations and salvage value. See Note 5 for additional discussion of our inventory.

Foreign Currency—The nature of our business activities involves the management of various financial and market risks, including those related to changes in foreign currency exchange rates. The effects of translating financial statements of foreign operations into our reporting currency are recognized as a cumulative translation adjustment in accumulated other comprehensive income (loss) (“AOCI”) which is net of tax, where applicable. Foreign currency transactional and re-measurement exchange gains (losses) are included within cost of revenue and were not material for the three and six months ended June 30, 2017 and 2016.

Financial Instruments—We do not engage in currency speculation; however, we utilize foreign currency exchange rate derivatives on an ongoing basis to hedge against certain foreign currency related operating exposures. We generally seek hedge accounting treatment for contracts used to hedge operating exposures and designate them as cash flow hedges. Therefore, gains and losses, exclusive of credit risk and forward points (which represent the time value component of the fair value of our derivative positions), are included in AOCI until the associated underlying operating exposure impacts our earnings. Changes in the fair value of (1) credit risk and forward points, (2) instruments deemed ineffective during the period, and (3) instruments that we do not designate as cash flow hedges are recognized within cost of revenue.

For those contracts designated as cash flow hedges, we document all relationships between the derivative instruments and associated hedged items, as well as our risk-management objectives and strategy for undertaking hedge transactions. This process includes linking all derivatives to specific firm commitments or highly-probable forecasted transactions. We continually assess, at inception and on an ongoing basis, the effectiveness of derivative instruments in offsetting changes in the cash flow of the designated hedged items. Hedge accounting designation is discontinued when (1) it is determined that the derivative is no longer highly effective in offsetting changes in the cash flow of the hedged item, including firm commitments or forecasted transactions, (2) the derivative is sold, terminated, exercised, or expires, (3) it is no longer probable that the forecasted transaction will occur, or (4) we determine that designating the derivative as a hedging instrument is no longer appropriate. See Note 9 for additional discussion of our financial instruments.

Income Taxes—Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis using currently enacted income tax rates for the years in which the differences are expected to reverse. A valuation allowance (“VA”) is provided to offset any net deferred tax assets (“DTA(s)”) if, based upon the available evidence, it is more likely than not that some or all of the DTAs will not be realized. The realization of our net DTAs depends upon our ability to generate sufficient future taxable income of the appropriate character and in the appropriate jurisdictions.

Income tax and associated interest and penalty reserves, where applicable, are recorded in those instances where we consider it more likely than not that additional tax will be due in excess of amounts reflected in income tax returns filed worldwide, irrespective of whether or not we have received tax assessments. We continually review our exposure to additional income tax obligations and, as further information is known or events occur, changes in our tax and penalty reserves may be recorded within income tax expense and changes in interest reserves may be recorded in interest expense.

Partnering Arrangements—In the ordinary course of business, we execute specific projects and conduct certain operations through joint venture, consortium and other collaborative arrangements (collectively referred to as “venture(s)”). We have various ownership interests in these ventures, with such ownership typically proportionate to our decision making and distribution rights. The ventures generally contract directly with the third party customer; however, services may be performed directly by the ventures, or may be performed by us, our partners, or a combination thereof.

Venture net assets consist primarily of working capital and property and equipment, and assets may be restricted from being used to fund obligations outside of the venture. These ventures typically have limited third party debt or have debt that is non-recourse in nature; however, they may provide for capital calls to fund operations or require participants in the venture to provide additional financial support, including advance payment or retention letters of credit.

Each venture is assessed at inception and on an ongoing basis as to whether it qualifies as a VIE under the consolidations guidance in ASC 810. A venture generally qualifies as a VIE when it (1) meets the definition of a legal entity, (2) absorbs the operational risk of the projects being executed, creating a variable interest, and (3) lacks sufficient capital investment from the partners, potentially resulting in the venture requiring additional subordinated financial support, if necessary, to finance its future activities.

If at any time a venture qualifies as a VIE, we perform a qualitative assessment to determine whether we are the primary beneficiary of the VIE and, therefore, need to consolidate the VIE. We are the primary beneficiary if we have (1) the power to direct the economically significant activities of the VIE and (2) the right to receive benefits from, and obligation to absorb losses of, the VIE. If the venture is a VIE and we are the primary beneficiary, or we otherwise have the ability to control the venture, we consolidate the venture. If we are not determined to be the primary beneficiary of the VIE, or only have the ability to significantly influence, rather than control the venture, we do not consolidate the venture. We account for unconsolidated ventures using either proportionate consolidation for both the Balance Sheet and Statement of Operations, when we meet the applicable accounting criteria to do so, or utilize the equity method. See Note 7 for additional discussion of our material partnering arrangements.

New Accounting Standards—In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, which provides a single comprehensive accounting standard for revenue recognition for contracts with customers and supersedes current industry-specific guidance, including ASC 605-35. The new standard prescribes a five-step revenue recognition model that focuses on transfer of control and entitlement to payment when determining the amount of revenue to be recognized. The new model requires companies to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time for each of these obligations. These concepts, as well as other aspects of the ASU, may change the method and/or timing of revenue recognition for certain of our contracts, primarily associated with our fabrication and manufacturing contracts. We expect that revenue generated from our EPC and engineering services contracts will continue to be recognized over time utilizing the cost-to-cost measure of progress consistent with current practice. We also expect our revenue recognition disclosures to significantly expand due to the new qualitative and quantitative requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from our contracts. We will adopt the standard, including any updates to the standard, upon its effective date in the first quarter 2018 utilizing the modified retrospective approach. This approach will result in a cumulative adjustment to beginning equity in the first quarter 2018 for uncompleted contracts impacted by the adoption of the standard. We are continuing to assess the potential impact of the new standard on our Financial Statements.

In February 2016, the FASB issued ASU 2016-02, which requires the recognition of a right-of-use asset and a lease liability for most lease arrangements with a term greater than one year, and increases qualitative and quantitative disclosures regarding leasing transactions. The standard is effective for us in the first quarter 2019, although early adoption is permitted. Transition requires application of the new guidance at the beginning of the earliest comparative balance sheet period presented utilizing a modified retrospective approach. We are assessing the timing of adoption of the new standard and its potential impact on our Financial Statements.

In the first quarter 2017, we adopted ASU 2015-11, which simplifies the subsequent measurement of our inventory by requiring inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Our adoption of the standard did not have a material impact on our Financial Statements.

In the first quarter 2017, we adopted ASU 2016-09, which modified the accounting for excess tax benefits and tax deficiencies associated with share-based payments, amended the associated cash flow presentation, and allows for forfeitures to be either recognized when they occur, or estimated. ASU 2016-09 eliminated the requirement to recognize excess tax benefits in additional paid-in capital (“APIC”), and the requirement to evaluate tax deficiencies for APIC or income tax expense classification, and provided for these benefits or deficiencies to be recorded as an income tax expense or benefit in the Statement of Operations. Additionally, tax benefits of dividends on share-based payment awards are reflected as an income tax expense or benefit in the income statement. With these changes, tax-related cash flows resulting from share-based payments are classified as operating activities as opposed to financing, as previously presented. We have elected to recognize forfeitures as they occur, rather than estimating expected forfeitures. Our adoption of the standard did not have a material impact on our Financial Statements.

In the first quarter 2017, the FASB issued, and we early adopted, ASU 2017-04, which eliminated the second step of the goodwill impairment test that required a hypothetical purchase price allocation. ASU 2017-04 requires that if a reporting unit’s carrying value exceeds its fair value, an impairment charge would be recognized for the excess amount, not to exceed the carrying amount of goodwill. Our early adoption of the standard in the first quarter 2017 did not have a material impact on our Financial Statements.

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EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

A reconciliation of weighted average basic shares outstanding to weighted average diluted shares outstanding and the computation of basic and diluted EPS are as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
Net (loss) income from continuing operations attributable to CB&I (net of $2,452, $8,272, $29,289 and $20,861 of noncontrolling interests)	$	(304,115	)	$	115,597	$	(288,541	)	$	216,931
Net (loss) income from discontinued operations attributable to CB&I (net of $457, $437, $870 and $885 of noncontrolling interests)	(121,304		)	8,242		(112,223		)	13,833
Net (loss) income attributable to CB&I	$	(425,419	)	$	123,839	$	(400,764	)	$	230,764
Weighted average shares outstanding—basic	100,866			105,298		100,660			105,051
Effect of restricted shares/performance based shares/stock options (1)	—			780		—			861
Effect of directors’ deferred-fee shares (1)	—			13		—			13
Weighted average shares outstanding—diluted	100,866			106,091		100,660			105,925
Net (loss) income attributable to CB&I per share (Basic):
Continuing operations	$	(3.02	)	$	1.10	$	(2.87	)	$	2.07
Discontinued operations	(1.20		)	0.08		(1.11		)	0.13
Total	$	(4.22	)	$	1.18	$	(3.98	)	$	2.20
Net (loss) income attributable to CB&I per share (Diluted):
Continuing operations	$	(3.02	)	$	1.09	$	(2.87	)	$	2.05
Discontinued operations	(1.20		)	0.08		(1.11		)	0.13
Total	$	(4.22	)	$	1.17	$	(3.98	)	$	2.18

⁽¹⁾ The effect of restricted shares, performance based shares, stock options and directors’ deferred-fee shares were not included in the calculation of diluted EPS for the three and six months ended June 30, 2017 due to the net loss for the periods. Antidilutive shares excluded from diluted EPS were not material for the three and six months ended June 30, 2016.

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DISPOSITION OF CAPITAL SERVICES OPERATIONS

6 Months Ended

Jun. 30, 2017

Discontinued Operations and Disposal Groups [Abstract]

DISPOSITION OF CAPITAL SERVICES OPERATIONS

DISPOSITION OF CAPITAL SERVICES OPERATIONS

Transaction Summary— As discussed in Note 2, on February 27, 2017, we entered into the CS Agreement, which provided for the sale of our Capital Services Operations and completed the sale on June 30, 2017. Under the CS Agreement, the initial purchase price was $755,000, subject to certain adjustments, including a working capital adjustment, whereby the purchase price would be adjusted to the extent actual working capital of the Capital Services Operations on the Closing Date differed from required working capital under the CS Agreement. Prior to the Closing Date, the CS Agreement was amended to, among other things, reduce the purchase price to $700,000. As a result, and after giving effect to working capital and other adjustments estimated prior to the Closing Date of approximately $32,600, we received cash proceeds of approximately $667,400 (approximately $645,500 net of cash sold) on the Closing Date. In addition, based on actual working capital of the Capital Services Operations on the Closing Date, we accrued our estimate of the final post-closing working capital adjustment within other current liabilities on our June 30, 2017 Balance Sheet, to be paid during the fourth quarter 2017. Accordingly, we estimate that our final net proceeds will be approximately $599,000, including approximately $46,500 for transaction costs and the aforementioned post-closing working capital adjustment. As a result of the aforementioned, during the three and six months ended June 30, 2017, we recorded a pre-tax charge of approximately $64,800, and income tax expense of approximately $61,000 resulting from a taxable gain on the transaction (due primarily to the non-deductibility of goodwill). The transaction will not result in any material cash taxes associated with the taxable gain due to the use of previously recorded net operating loss carryforwards. The proceeds received on the Closing Date were used to reduce our outstanding debt.

Assets and Liabilities—The carrying values of the major classes of assets and liabilities of the discontinued Capital Services Operations included within our Balance Sheet on December 31, 2016 were as follows:

	December 31, 2016
Assets
Cash	$	14,477
Accounts receivable, net	239,146
Costs and estimated earnings in excess of billings	153,275
Other assets	7,834
Current assets of discontinued operations	414,732
Property and equipment, net	59,746
Goodwill (1)	229,607
Other intangibles, net	148,440
Other assets	24,351
Non-current assets of discontinued operations	462,144
Total assets of discontinued operations	$	876,876
Liabilities
Accounts payable	$	141,028
Billings in excess of costs and estimated earnings	53,986
Other liabilities	52,455
Current liabilities of discontinued operations	247,469
Other liabilities	5,388
Non-current liabilities of discontinued operations	5,388
Total liabilities of discontinued operations	$	252,857
Noncontrolling interests of discontinued operations	$	6,874

⁽¹⁾  The carrying value of goodwill for the Capital Services Operations includes the impact of a $655,000 impairment charge recorded in the fourth quarter 2016 in connection with our annual impairment assessment.

Results of Operations—The results of our Capital Services Operations which have been reflected within discontinued operations in our Statement of Operations for the three and six months ended June 30, 2017 and 2016 were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Revenue	$	561,708		$	559,690		$	1,114,655		$	1,124,671
Cost of revenue	528,927			523,119			1,047,614			1,056,065
Gross profit	32,781			36,571			67,041			68,606
Selling and administrative expense	16,503			13,536			29,541			25,187
Intangibles amortization	—			4,030			2,550			8,230
Loss on net assets sold	64,817			—			64,817			—
Other operating expense (income)	876			120			504			(304		)
Operating (loss) income from discontinued operations	(49,415		)	18,885			(30,371		)	35,493
Interest expense (1)	(6,577		)	(5,877		)	(13,440		)	(11,710		)
Interest income	7			305			16			614
(Loss) income from discontinued operations before taxes	(55,985		)	13,313			(43,795		)	24,397
Income tax expense (2)	(64,862		)	(4,634		)	(67,558		)	(9,679		)
Net (loss) income from discontinued operations	(120,847		)	8,679			(111,353		)	14,718
Net income from discontinued operations attributable to noncontrolling interests	(457		)	(437		)	(870		)	(885		)
Net (loss) income from discontinued operations attributable to CB&I	$	(121,304	)	$	8,242		$	(112,223	)	$	13,833

⁽¹⁾ Interest expense was allocated to the Capital Services Operations due to a requirement to use the proceeds of the transaction to repay our debt. Proceeds from the transaction were initially used to repay our revolving facility borrowings as of June 30, 2017. The revolving facility was subsequently utilized to repay a portion of our senior notes in July 2017, as described in Note 8. The allocation of interest expense was based upon the debt amounts to be repaid.

⁽²⁾ As noted above, the transaction resulted in a taxable gain (due primarily to the non-deductibility of goodwill) resulting in additional tax expense of approximately $61,000 during the three and six months ended June 30, 2017.

Cash Flows—Cash flows for our Capital Services Operations for the six months ended June 30, 2017 and 2016 were as follows:

	Six Months Ended June 30,
	2017			2016
Operating cash flows	$	(36,469	)	$	28,470
Investing cash flows	$	(1,459	)	$	(2,495	)

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INVENTORY

6 Months Ended

Jun. 30, 2017

Inventory Disclosure [Abstract]

INVENTORY

INVENTORY

The components of inventory at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017		December 31, 2016
Raw materials	$	97,231	$	65,969
Work in process	28,717		51,625
Finished goods	32,870		72,508
Total	$	158,818	$	190,102

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GOODWILL AND OTHER INTANGIBLES

6 Months Ended

Jun. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLES

GOODWILL AND OTHER INTANGIBLES

Goodwill—At June 30, 2017 and December 31, 2016, our goodwill balances were $2,829,214 and $2,813,803, respectively, attributable to the excess of the purchase price over the fair value of net assets acquired in connection with our acquisitions. The change in goodwill for the six months ended June 30, 2017 is as follows:

	Total
Balance at December 31, 2016	$	2,813,803
Foreign currency translation and other	16,596
Amortization of tax goodwill in excess of book goodwill	(1,185		)
Balance at June 30, 2017 (1)	$	2,829,214

⁽¹⁾  At June 30, 2017, we had approximately $453,100 of cumulative impairment losses which were recorded in our Engineering & Construction operating group during 2015 related to the sale of our nuclear power construction business (our “Nuclear Operations”) on December 31, 2015.

As discussed further in Note 2, goodwill is not amortized to earnings, but instead is reviewed for impairment at least annually at a reporting unit level, absent any indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based upon balances as of October 1. At December 31, 2016, we had the following three operating groups and reporting units:

• Engineering & Construction—Our Engineering & Construction operating group represented a reporting unit.

• Fabrication Services—Our Fabrication Services operating group represented a reporting unit.

• Technology—Our Technology operating group represented a reporting unit.

During the three months ended December 31, 2016, we performed a quantitative assessment of goodwill for each of the aforementioned reporting units. Based upon these quantitative assessments, the fair value of each of these reporting units substantially exceeded their respective net book values, and accordingly, no impairment charge was necessary as a result of our impairment assessments. During the three months ended June 30, 2017, we experienced a decline in our market capitalization and incurred charges on certain projects (as discussed further in Note 14) within our Engineering & Construction reporting unit that resulted in a net loss for the three and six months ended June 30, 2017. We believe these events and circumstances were indicators that goodwill of our Engineering & Construction reporting unit was potentially impaired. Accordingly, we performed a quantitative assessment of goodwill for our Engineering & Construction reporting unit as of June 30, 2017. Based on this quantitative assessment, the fair value of the Engineering & Construction reporting unit continued to substantially exceed its net book value, and accordingly, no impairment charge was necessary as a result of our interim impairment assessment. If we were to experience an additional decline in our market capitalization, or a prolonged market capitalization at our current levels, it could indicate that the goodwill of our reporting units is impaired, and require additional interim quantitative impairment assessments. If, based on future assessments our goodwill is deemed to be impaired, the impairment would result in a charge to earnings in the period of impairment. There can be no assurance that future goodwill impairment tests will not result in charges to earnings. See Note 4 for discussion of our goodwill impairment for the Capital Services Operations recorded in the fourth quarter 2016 in connection with our annual impairment assessment.

Other Intangible Assets—The following table presents our acquired finite-lived intangible assets at June 30, 2017 and December 31, 2016, including the June 30, 2017 weighted-average useful lives for each major intangible asset class and in total:

		June 30, 2017					December 31, 2016
	Weighted Average Life	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Backlog and customer relationships	18 Years	$	99,086	$	(24,143	)	$	99,086	$	(21,374	)
Process technologies	15 Years	263,043		(140,717		)	258,516		(129,261		)
Tradenames	12 Years	27,327		(16,208		)	27,090		(14,648		)
Total (1)	16 Years	$	389,456	$	(181,068	)	$	384,692	$	(165,283	)

⁽¹⁾  The decrease in other intangibles, net during the six months ended June 30, 2017 primarily related to amortization expense of approximately $12,900.

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PARTNERING ARRANGEMENTS

6 Months Ended

Jun. 30, 2017

Equity Method Investments and Joint Ventures [Abstract]

PARTNERING ARRANGEMENTS

PARTNERING ARRANGEMENTS

As discussed in Note 2, we account for our unconsolidated ventures using either proportionate consolidation, when we meet the applicable accounting criteria to do so, or the equity method. Further, we consolidate any venture that is determined to be a VIE for which we are the primary beneficiary, or which we otherwise effectively control.

Proportionately Consolidated Ventures—The following is a summary description of our significant joint ventures whichhave been accounted for using proportionate consolidation:

• CB&I/Zachry—We have a venture with Zachry (CB&I—50% / Zachry—50%) to perform EPC work for two liquefied natural gas (“LNG”) liquefaction trains in Freeport, Texas. Our proportionate share of the venture project value is approximately $2,700,000. In addition, we have subcontract and risk sharing arrangements with Chiyoda to support our responsibilities to the venture. The costs of these arrangements are recorded in cost of revenue.

• CB&I/Zachry/Chiyoda—We have a venture with Zachry and Chiyoda (CB&I—33.3% / Zachry—33.3% / Chiyoda—33.3%) to perform EPC work for an additional LNG liquefaction train at the aforementioned project site in Freeport, Texas. Our proportionate share of the venture project value is approximately $675,000.

• CB&I/Chiyoda—We have a venture with Chiyoda (CB&I—50% / Chiyoda—50%) to perform EPC work for three LNG liquefaction trains in Hackberry, Louisiana. Our proportionate share of the venture project value is approximately $3,200,000.

The following table presents summarized balance sheet information for our share of our proportionately consolidated ventures at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
CB&I/Zachry
Current assets (1)	$	251,237	$	260,934
Non-current assets	2,678		3,204
Total assets	$	253,915	$	264,138
Current liabilities (1)	$	387,466	$	379,339
CB&I/Zachry/Chiyoda
Current assets (1)	$	88,593	$	84,279
Non-current assets	1,539		1,969
Total assets	$	90,132	$	86,248
Current liabilities (1)	$	68,305	$	73,138
CB&I/Chiyoda
Current assets (1)	$	186,278	$	337,479
Current liabilities (1)	$	258,367	$	150,179

⁽¹⁾  Our venture arrangements allow for excess working capital of the ventures to be advanced to the venture partners. Such advances are returned to the ventures for working capital needs as necessary. Accordingly, at a reporting period end a venture may have advances to its partners which are reflected as an advance receivable within current assets of the venture. At June 30, 2017 and December 31, 2016, other current assets on the Balance Sheet included approximately $324,400 and $374,800, respectively, related to our proportionate share of advances from the ventures to our venture partners, and other current liabilities included approximately $347,300 and $394,400, respectively, related to advances to CB&I from the ventures.

Equity Method Ventures—The following is a summary description of our significant joint ventures which have been accounted for using the equity method:

• Chevron-Lummus Global (“CLG”)—We have a venture with Chevron (CB&I—50% / Chevron—50%) which provides proprietary process technology licenses and associated engineering services and catalyst, primarily for the refining industry. As sufficient capital investments in CLG have been made by the venture partners, it does not qualify as a VIE.

• NET Power—We have a venture with Exelon and 8 Rivers Capital (CB&I—33.3% / Exelon—33.3% / 8 Rivers Capital—33.3%) to commercialize a new natural gas power generation system that recovers the carbon dioxide produced during combustion. NET Power is building a first-of-its-kind demonstration plant which is being funded by contributions and services from the venture partners and other parties. We have determined the venture to be a VIE; however, we do not effectively control NET Power and therefore do not consolidate it. Our cash commitment for NET Power totals $47,300 and at June 30, 2017, we had made cumulative investments totaling approximately $44,900.

• CB&I/CTCI—We have a venture with CTCI (CB&I—50% / CTCI—50%) to perform EPC work for a liquids ethylene cracker and associated units in Sohar, Oman. We have determined the venture to be a VIE; however, we do not effectively control the venture and therefore do not consolidate it. Our proportionate share of the venture project value is approximately $1,400,000. Our venture arrangement allows for excess working capital of the venture to be advanced to the venture partners. Such advances are returned to the venture for working capital needs as necessary. At June 30, 2017 and December 31, 2016, other current liabilities included approximately $205,900 and $147,000, respectively, related to advances to CB&I from the venture.

Consolidated Ventures—The following is a summary description of our significant joint ventures we consolidate due to their designation as VIEs for which we are the primary beneficiary:

• CB&I/Kentz—We have a venture with Kentz (CB&I—65% / Kentz—35%) to perform the structural, mechanical, piping, electrical and instrumentation work on, and to provide commissioning support for, three LNG trains, including associated utilities and a gas processing and compression plant, for the Gorgon LNG project, located on Barrow Island, Australia. Our venture project value is approximately $5,900,000 and the project was substantially complete at June 30, 2017.

• CB&I/AREVA—We have a venture with AREVA (CB&I—52% / AREVA—48%) to design, license and construct a mixed oxide fuel fabrication facility in Aiken, South Carolina. Our venture project value is approximately $5,800,000.

The following table presents summarized balance sheet information for our consolidated ventures at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
CB&I/Kentz
Current assets	$	26,486	$	68,867
Non-current assets	69,404		—
Total assets	$	95,890	$	68,867
Current liabilities	$	27,581	$	87,822
CB&I/AREVA
Current assets	$	24,416	$	16,313
Current liabilities	$	50,086	$	47,652
All Other (1)
Current assets	$	33,099	$	69,785
Non-current assets	16,003		16,382
Total assets	$	49,102	$	86,167
Current liabilities	$	8,514	$	7,748

⁽¹⁾  Other ventures that we consolidate are not individually material to our financial results and are therefore aggregated as “All Other”.

Other—The use of these ventures exposes us to a number of risks, including the risk that our partners may be unable or unwilling to provide their share of capital investment to fund the operations of the venture or complete their obligations to us, the venture, or ultimately, our customer. Differences in opinions or views among venture partners could also result in delayed decision-making or failure to agree on material issues, which could adversely affect the business and operations of the venture. In addition, agreement terms may subject us to joint and several liability for our venture partners, and the failure of our venture partners to perform their obligations could impose additional performance and financial obligations on us. The aforementioned factors could result in unanticipated costs to complete the projects, liquidated damages or contract disputes, including claims against our partners.

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DEBT

6 Months Ended

Jun. 30, 2017

Debt Disclosure [Abstract]

DEBT

DEBT

Our outstanding debt at June 30, 2017 and December 31, 2016 was as follows:

	June 30, 2017			December 31, 2016
Current
Revolving facility and other short-term borrowings	$	374,000		$	407,500
Current maturities of long-term debt	1,481,250			506,250
Less: unamortized debt issuance costs	(11,930		)	(2,340		)
Current maturities of long-term debt, net of unamortized debt issuance costs	1,469,320			503,910
Current debt, net of unamortized debt issuance costs	$	1,843,320		$	911,410
Long-Term
Term Loan: $1,000,000 term loan (interest at LIBOR plus a floating margin)	$	—		$	300,000
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)	481,250			500,000
Senior Notes: $800,000 senior notes, series A-D (fixed interest ranging from 4.65% to 5.80%)	800,000			800,000
Second Senior Notes: $200,000 senior notes (fixed interest of 5.03%)	200,000			200,000
Less: unamortized debt issuance costs	—			(5,827		)
Less: current maturities of long-term debt	(1,481,250		)	(506,250		)
Long-term debt, net of unamortized debt issuance costs	$	—		$	1,287,923

Committed Facilities—We have a five-year, $1,150,000 committed revolving credit facility (the “Revolving Facility”) with Bank of America N.A. (“BofA”), as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole Corporate and Investment Bank (“Credit Agricole”) and TD Securities, each as syndication agents, which expires in October 2018. The Revolving Facility had a $230,000 financial letter of credit sublimit at June 30, 2017. However, as a result of the amendments described below, effective August 9, 2017, the financial letter of credit sublimit was replaced with a $100,000 total letter of credit sublimit. At June 30, 2017, we had $204,000 and $67,211 of outstanding borrowings and letters of credit (none of which were financial letters of credit) under the facility, respectively, providing $878,789 of available capacity, of which $32,789 was available for letters of credit based on our new total letter of credit sublimit.

We also have a five-year, $800,000 committed revolving credit facility (the “Second Revolving Facility”) with BofA, as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole and Bank of Tokyo Mitsubishi UFJ, each as syndication agents, which expires in July 2020. The Second Revolving Facility supplements our Revolving Facility, and had a $50,000 financial letter of credit sublimit at June 30, 2017. However, as a result of the amendments described below, effective August 9, 2017, the financial letter of credit sublimit was replaced with a $100,000 total letter of credit sublimit. At June 30, 2017, we had $170,000 and $72,445 of outstanding borrowings and letters of credit (including $2,757 of financial letters of credit) under the facility, respectively, providing $557,555 of available capacity, of which $27,555 was available for letters of credit based on our new total letter of credit sublimit.

During the six months ended June 30, 2017, maximum outstanding borrowings under our Revolving Facility and Second Revolving Facility (together, “Committed Facilities”) were approximately $1,700,000. We are assessed quarterly commitment fees on the unutilized portion of the facilities as well as letter of credit fees on outstanding letters of credit. Through the date of the amendments described below, the interest, commitment fee, and letter of credit fee percentages were based on our quarterly leverage ratio and interest on borrowings under the facilities was assessed at either prime plus an applicable floating margin (4.25% and 1.50%, respectively at June 30, 2017), or LIBOR plus an applicable floating margin (1.23% and 2.50%, respectively at June 30, 2017). However, as a result of the amendments, effective August 9, 2017, interest on borrowings under the amended facilities will be assessed at either prime plus 4.00% or LIBOR plus 5.00%. In addition, our fees for financial and performance letters of credit will be 5.00% and 3.50%, respectively. During the six months ended June 30, 2017, our weighted average interest rate on borrowings under the Revolving Facility and Second Revolving Facility was approximately 3.3% and 4.9%, respectively, inclusive of the applicable floating margin. The Committed Facilities have financial and restrictive covenants described further below.

Uncommitted Facilities—We also have various short-term, uncommitted letter of credit facilities (the “Uncommitted Facilities”) across several geographic regions, under which we had $1,624,089 of outstanding letters of credit as of June 30, 2017.

Term Loans—On February 13, 2017, we paid the remaining $300,000 of principal on our four-year, $1,000,000 unsecured term loan (the “Term Loan”) with BofA as administrative agent. Interest was based upon LIBOR plus an applicable floating margin for the period (0.98% and 2.25%, respectively). In conjunction with the repayment of the Term Loan, we also settled our associated interest rate swap that hedged against a portion of the Term Loan, which resulted in a weighted average interest rate of approximately 2.6% during the first quarter 2017.

At June 30, 2017, we had $481,250 outstanding under a five-year, $500,000 term loan (the “Second Term Loan”) with BofA as administrative agent. Interest and principal under the Second Term Loan is payable quarterly in arrears beginning in June 2017, and through the date of the amendments described below, bore interest at LIBOR plus an applicable floating margin (1.23% and 2.50%, respectively at June 30, 2017). However, as a result of the amendments, effective August 9, 2017, interest will be assessed at either prime plus 4.00% or LIBOR plus 5.00%. During the six months ended June 30, 2017, our weighted average interest rate on the Second Term Loan was approximately 3.1%, inclusive of the applicable floating margin. Future annual maturities for the Second Term Loan are $37,500, $75,000, $75,000 and $293,750 for 2017, 2018, 2019, and 2020, respectively. The Second Term Loan has financial and restrictive covenants described further below.

Senior Notes—We have a series of senior notes totaling $800,000 in aggregate principal amount outstanding as of June 30, 2017 (the “Senior Notes”). The Senior Notes include Series A through D and contained the following terms at June 30, 2017:

• Series A—Interest due semi-annually at a fixed rate of 4.65%, with principal of $150,000 due in December 2017

• Series B—Interest due semi-annually at a fixed rate of 5.07%, with principal of $225,000 due in December 2019

• Series C—Interest due semi-annually at a fixed rate of 5.65%, with principal of $275,000 due in December 2022

• Series D—Interest due semi-annually at a fixed rate of 5.80%, with principal of $150,000 due in December 2024

On July 28, 2017, we utilized $211,800 of the proceeds from the sale of the Capital Services Operations to repay a portion of each series of senior notes in the following amounts: (Series A - $44,600, Series B - $58,200, Series C - $78,500 and Series D - $30,500). The repayment dates for the remaining principal amounts remained the same.    

We also have senior notes totaling $200,000 in aggregate principal amount outstanding as of June 30, 2017 (the “Second Senior Notes”) with BofA as administrative agent. At June 30, 2017, interest was due semi-annually at a fixed rate of 5.03%, with principal of $200,000 due in July 2025. On July 28, 2017, we utilized $57,100 of the proceeds from the sale of the Capital Services Operations to repay a portion of the Second Senior Notes. The repayment date for the remaining principal amount remained the same.

The Senior Notes and Second Senior Notes (together, the “Notes”) have financial and restrictive covenants described further below. Further, as a result of the amendments described below, our fixed interest rate on the amended Notes was increased by an incremental 2.50% over the rates in effect immediately prior to such amendments. The amended Notes also include provisions relating to our credit profile, which if not maintained will result in an incremental annual cost of up to 1.50% of the outstanding balance under the Notes. Further, the Notes include provisions relating to our leverage, which if not maintained, could result in an incremental annual cost of up to 1.00% (or 0.50% depending on our leverage level) of the outstanding balance under the Notes, provided that the incremental annual cost related to our credit profile and leverage cannot exceed 2.00% per annum. Finally, the Notes are subject to a make-whole premium in connection with certain prepayment events.

Compliance and Other—On February 24, 2017, and effective for the period ended December 31, 2016, we amended our Revolving Facility, Second Revolving Facility, and Second Term Loan (collectively, “Bank Facilities”) and Notes (collectively, with Bank Facilities, “Senior Facilities”). The amendments:

• Established a new maximum leverage ratio of 3.50 at December 31, 2016, decreasing to 3.00 at December 31, 2017, or 45 days subsequent to the closing of the sale of our Capital Services Operations (the “Closing Date”), if earlier.

• Established a new minimum net worth of $1,201,507, maintained our required fixed charge coverage ratio at 1.75, and reduced our Revolving Facility from $1,350,000 to $1,150,000 at the Closing Date.

• Included other financial and restrictive covenants, including restrictions regarding subsidiary indebtedness, sales of assets, liens, investments, type of business conducted, and mergers and acquisitions, and restrictions on dividend payments and share repurchases, among other restrictions.

On May 8, 2017, and effective for the period ended March 31, 2017, we further amended our Senior Facilities. The amendments:

• Required us to secure the Senior Facilities through the pledge of cash, accounts receivable, inventory, fixed assets, and stock of subsidiaries, which was in the process of being completed as of June 30, 2017.

• Required us to repay portions of the Senior Facilities with all of the net proceeds from the sale of our Capital Services Operations, the issuance of any unsecured debt that is subordinate (“Subordinated Debt”) to the Senior Facilities, the issuance of any equity securities, or the sale of any assets.

• Established new maximum leverage ratios for borrowings under the Senior Facilities as follows: 4.00 at March 31, 2017; 4.50 at June 30, 2017 and September 30, 2017; 3.00 at December 31, 2017 and March 31, 2018; and 2.50 at June 30, 2018.

• Established total maximum leverage ratios (in addition to those established for the Senior Facilities) for all borrowings among the Senior Facilities and any Subordinated Debt as follows: 5.25 at June 30, 2017; 6.00 at September 30, 2017; 4.00 at December 31, 2017 and March 31, 2018; 3.25 at June 30, 2018; and 3.00 at September 30, 2018.

• Prohibited mergers and acquisitions, open-market share repurchases, and increases to dividends until our leverage ratio is below 3.00 for two consecutive quarters.

As a result of the project impacts in the second quarter 2017 (discussed further in Note 14), as of June 30, 2017, we would not have been in compliance with the previously amended financial covenants for our Senior Facilities, without certain waivers and amendments. Accordingly, effective August 9, 2017 (the “Effective Date”), and effective for the period ended June 30, 2017, we are further amending our Senior Facilities. The amendments, which are subject to final documentation, waive our noncompliance with our existing covenants as of June 30, 2017 and certain other defaults and events of default. In addition, the amendments:

• Eliminate our Minimum Net Worth covenant required by our previous amendments.

• Require minimum levels of trailing 12-month earnings before interest, taxes, depreciation and amortization (“EBITDA”), as defined by the amendments, as follows: $500,000 at September 30, 2017; $550,000 at December 31, 2017; $500,000 at March 31, 2018; $450,000 at June 30, 2018 and September 30, 2018; and $425,000 at December 31, 2018 and thereafter (“Minimum EBITDA”). Trailing 12-month EBITDA for purposes of determining compliance with the Minimum EBITDA covenant will be adjusted to exclude: an agreed amount attributable to any restructuring or integration charges during the third and fourth quarters of 2017; an agreed amount attributable to previous charges on certain projects which occurred during the first and second quarters of 2017; and an agreed amount for potential future charges for the same projects if they were to be incurred during the third and fourth quarters of 2017 (collectively, the “EBITDA Addbacks”).

• Provide for the replacement of our previous maximum leverage ratio and minimum fixed charge ratio with a new maximum leverage ratio of 1.75 (“Maximum Leverage Ratio”) and new minimum fixed charge coverage ratio of 2.25 (“Minimum Fixed Charge Coverage Ratio”), which are temporarily suspended and will resume as of March 31, 2018. Trailing 12-month EBITDA for purposes of determining compliance with the Maximum Leverage Ratio and consolidated net income for purposes of determining compliance with the Minimum Fixed Charge Coverage Ratio will be adjusted for the EBITDA Addbacks.

• Require us to execute on our plan to market and sell our Technology Operations by December 27, 2017 (the “Technology Sale”), with an extension of up to 60 days at the discretion of the holders of a majority of the outstanding Notes and at the discretion of the administrative agents of the Bank Facilities.

• Require us to maintain a minimum aggregate availability under our Revolving Facility and Second Revolving Facility, including borrowings and letters of credit, of $150,000 at all times from the Effective Date through the date of the Technology Sale, and $250,000 thereafter (“Minimum Availability”). Our amendments require the net cash proceeds from the Technology Sale be used to repay our Senior Facilities (“Mandatory Repayment Amount”). Further, our aggregate capacity under the Revolving Facility and Second Revolving Facility will be reduced by seventy percent (70%) of the portion of the Mandatory Repayment Amount allocable to the Revolving Facility and Second Revolving Facility, upon closing the Technology Sale and certain other mandatory prepayment events.

• Limit the amount of certain of our funded indebtedness to $3,000,000 prior to the Technology Sale and $2,900,000 thereafter, in each case, subject to reduction pursuant to scheduled repayments and mandatory prepayments thereof (but, with respect to the Revolving Facility and Second Revolving Facility, only to the extent the commitments have been reduced by such prepayments) made by us after the Effective Date.

• Prohibit mergers and acquisitions, open-market share repurchases and dividend payments and certain inter-company transactions.

• Replace the previous financial letter of credit sublimits for our Revolving Facility and Second Revolving Facility with a $100,000 letter of credit sublimit for each, as described further above.

• Adjust the interest rates on our Senior Facilities, as described further above.

As discussed above, our amended covenants require, among other things, the completion of our plan to sell the Technology Operations. Further, we are required to comply with various new restrictive and financial covenants, including the Minimum EBITDA and Minimum Availability covenants. Although we received temporary suspension of our Maximum Leverage Ratio and Minimum Fixed Charge Coverage Ratio, these covenants will resume effective March 31, 2018. Based on our forecasted EBITDA and cash flows, we project that future compliance with certain covenants subsequent to December 31, 2017 will require the completion of the Technology Sale and associated net proceeds consistent with our expectations. Accordingly, debt of approximately $1,200,000, which by its terms is due beyond one year and would otherwise be shown as long-term, has been classified as current, as certain factors regarding our compliance with such covenants is beyond our control.

In addition to providing letters of credit, we also issue surety bonds in the ordinary course of business to support our contract performance. At June 30, 2017, we had $358,739 of outstanding surety bonds in support of our projects. In addition, we had $473,194 of surety bonds maintained on behalf of our former Capital Services Operations, for which we have received an indemnity from CSVC. We also continue to maintain guarantees on behalf of our former Capital Services Operations in support of approximately $166,000 of backlog, for which we have also received an indemnity.

Capitalized interest was insignificant for the six months ended June 30, 2017 and 2016.

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FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS

Derivatives

Foreign Currency Exchange Rate Derivatives—At June 30, 2017, the notional value of our outstanding forward contracts to hedge certain foreign exchange-related operating exposures was approximately $139,600. These contracts vary in duration, maturing up to five years from period-end. We designate certain of these hedges as cash flow hedges and accordingly, changes in their fair value are recognized in AOCI until the associated underlying operating exposure impacts our earnings. Forward points, which are deemed to be an ineffective portion of the hedges, are recognized within cost of revenue and are not material.

Financial Instruments Disclosures

Fair Value—Financial instruments are required to be categorized within a valuation hierarchy based upon the lowest level of input that is significant to the fair value measurement. The three levels of the valuation hierarchy are as follows:

• Level 1—Fair value is based upon quoted prices in active markets.

• Level 2—Fair value is based upon internally-developed models that use, as their basis, readily observable market parameters. Our derivative positions are classified within level 2 of the valuation hierarchy as they are valued using quoted market prices for similar assets and liabilities in active markets. These level 2 derivatives are valued utilizing an income approach, which discounts future cash flow based upon current market expectations and adjusts for credit risk.

• Level 3—Fair value is based upon internally-developed models that use, as their basis, significant unobservable market parameters. We did not have any level 3 classifications at June 30, 2017 or December 31, 2016.

The following table presents the fair value of our foreign currency exchange rate derivatives and interest rate derivatives at June 30, 2017 and December 31, 2016, respectively, by valuation hierarchy and balance sheet classification:

	June 30, 2017										December 31, 2016
	Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3		Total
Derivative Assets (1)
Other current assets	$	—	$	4,766		$	—	$	4,766		$	—	$	1,146		$	—	$	1,146
Other non-current assets	—		561			—		561			—		82			—		82
Total assets at fair value	$	—	$	5,327		$	—	$	5,327		$	—	$	1,228		$	—	$	1,228
Derivative Liabilities
Other current liabilities	$	—	$	(551	)	$	—	$	(551	)	$	—	$	(3,509	)	$	—	$	(3,509	)
Other non-current liabilities	—		(908		)	—		(908		)	—		(725		)	—		(725		)
Total liabilities at fair value	$	—	$	(1,459	)	$	—	$	(1,459	)	$	—	$	(4,234	)	$	—	$	(4,234	)

⁽¹⁾  We are exposed to credit risk on our hedging instruments associated with potential counterparty non-performance, and the fair value of our derivatives reflects this credit risk. The total level 2 assets at fair value above represent the maximum loss that we would incur on our outstanding hedges if the applicable counterparties failed to perform according to the hedge contracts. To help mitigate counterparty credit risk, we transact only with counterparties that are rated as investment grade or higher and monitor all counterparties on a continuous basis.

The carrying values of our cash and cash equivalents (primarily consisting of bank deposits), accounts receivable and accounts payable approximate their fair values because of the short-term nature of these instruments. At June 30, 2017, the fair value of our Second Term Loan, based upon the current market rates for debt with similar credit risk and maturities, approximated its carrying value as interest is based upon LIBOR plus an applicable floating margin. At June 30, 2017, the fair values of our Senior Notes and Second Senior Notes, based upon the current market rates for debt with similar credit risk and maturities, approximated their carrying values due to their classification as current on our Balance Sheet. At December 31, 2016, our Senior Notes and Second Senior Notes had a total fair value of approximately $785,700 and $206,400, respectively, based on current market rates for debt with similar credit risk and maturities and were categorized within level 2 of the valuation hierarchy.

Derivatives Disclosures

Fair Value—The following table presents the total fair value by underlying risk and balance sheet classification for derivatives designated as cash flow hedges and derivatives not designated as cash flow hedges at June 30, 2017 and December 31, 2016:

	Other Current and Non-Current Assets				Other Current and Non-Current Liabilities
	June 30, 2017		December 31, 2016		June 30, 2017			December 31, 2016
Derivatives designated as cash flow hedges
Interest rate	$	—	$	49	$	—		$	—
Foreign currency	545		109		—			(536		)
Fair value	$	545	$	158	$	—		$	(536	)
Derivatives not designated as cash flow hedges
Foreign currency	$	4,782	$	1,070	$	(1,459	)	$	(3,698	)
Fair value	$	4,782	$	1,070	$	(1,459	)	$	(3,698	)
Total fair value	$	5,327	$	1,228	$	(1,459	)	$	(4,234	)

Master Netting Arrangements (“MNAs”)—Our derivatives are executed under International Swaps and Derivatives Association MNAs, which generally allow us and our counterparties to net settle, in a single net payable or receivable, obligations due on the same day, in the same currency and for the same type of derivative instrument. We have elected the option to record all derivatives on a gross basis in our Balance Sheet. The following table presents our derivative assets and liabilities at June 30, 2017 on a gross basis and a net settlement basis:

	Gross Amounts Recognized (i)			Gross Amounts Offset on the Balance Sheet (ii)		Net Amounts Presented on the Balance Sheet (iii) = (i) - (ii)			Gross Amounts Not Offset on the Balance Sheet (iv)					Net Amount (v) = (iii) - (iv)
									Financial Instruments			Cash Collateral Received
Derivative Assets
Foreign currency	5,327			—		5,327			(179		)	—		5,148
Total assets	$	5,327		$	—	$	5,327		$	(179	)	$	—	$	5,148
Derivative Liabilities
Foreign currency	(1,459		)	—		(1,459		)	179			—		(1,280		)
Total liabilities	$	(1,459	)	$	—	$	(1,459	)	$	179		$	—	$	(1,280	)

AOCI/Other—The following table presents the total value, by underlying risk, recognized in other comprehensive income (“OCI”) and reclassified from AOCI to interest expense (interest rate derivatives) and cost of revenue (foreign currency derivatives) during the three and six months ended June 30, 2017 and 2016 for derivatives designated as cash flow hedges:

	Amount of Gain (Loss) on Effective Derivative Portion
	Recognized in OCI										Reclassified from AOCI into Earnings (1)
	Three Months Ended June 30,					Six Months Ended June 30,					Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017		2016			2017		2016			2017		2016
Derivatives designated as cash flow hedges
Interest rate	$	—	$	(248	)	$	—	$	(961	)	$	—	$	(163	)	$	49	$	(344	)
Foreign currency	497		(655		)	1,179		821			84		148			208		(914		)
Total	$	497	$	(903	)	$	1,179	$	(140	)	$	84	$	(15	)	$	257	$	(1,258	)

⁽¹⁾  Net unrealized gains totaling approximately $600 are anticipated to be reclassified from AOCI into earnings during the next 12 months due to settlement of the associated underlying obligations.

The following table presents the total value recognized in cost of revenue for the three and six months ended June 30, 2017 and 2016 for foreign currency derivatives not designated as cash flow hedges:

	Amount of Gain (Loss) Recognized in Earnings
	Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017			2016
Derivatives not designated as cash flow hedges
Foreign currency	$	5,774	$	(4,930	)	$	(396	)	$	(9,159	)
Total	$	5,774	$	(4,930	)	$	(396	)	$	(9,159	)

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RETIREMENT BENEFITS

6 Months Ended

Jun. 30, 2017

Compensation and Retirement Disclosure [Abstract]

RETIREMENT BENEFITS

RETIREMENT BENEFITS

Our 2016 Annual Report disclosed anticipated 2017 defined benefit pension and other postretirement plan contributions of approximately $17,000 and $2,500, respectively. The following table provides updated contribution information for these plans at June 30, 2017:

	Pension Plans		Other Postretirement Plans
Contributions made through June 30, 2017	$	9,720	$	1,040
Contributions expected for the remainder of 2017	8,183		1,238
Total contributions expected for 2017	$	17,903	$	2,278

The following table provides a breakout of the components of net periodic benefit cost (income) associated with our defined benefit pension and other postretirement plans for the three and six months ended June 30, 2017 and 2016:

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Pension Plans
Service cost	$	2,871		$	2,384		$	5,653		$	4,711
Interest cost	4,737			5,975			9,328			11,893
Expected return on plan assets	(5,968		)	(6,821		)	(11,754		)	(13,617		)
Amortization of prior service credits	(156		)	(158		)	(306		)	(312		)
Recognized net actuarial losses	1,529			1,475			3,027			2,936
Settlement expense (1)	2,426			—			2,426			—
Net periodic benefit cost	$	5,439		$	2,855		$	8,374		$	5,611
Other Postretirement Plans
Service cost	$	171		$	176		$	342		$	352
Interest cost	342			341			684			681
Recognized net actuarial gains	(685		)	(841		)	(1,370		)	(1,681		)
Net periodic benefit income	$	(172	)	$	(324	)	$	(344	)	$	(648	)

⁽¹⁾  Net periodic benefit cost in 2017 was impacted by the settlement of our qualified Canadian pension plan in the second quarter 2017. The settlement resulted in the immediate recognition of previously unrecognized actuarial gains related to the plan that were previously included in AOCI.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2017

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

General—We have been and may from time to time be named as a defendant in legal actions claiming damages in connection with engineering and construction projects, technology licenses, other services we provide, and other matters. These are typically claims that arise in the normal course of business, including employment-related claims and contractual disputes or claims for personal injury or property damages which occur in connection with services performed relating to project or construction sites. Contractual disputes normally involve claims relating to the timely completion of projects, performance of equipment or technologies, design or other engineering services or project construction services provided by us. We do not believe that any of our pending contractual, employment-related personal injury or property damage claims and disputes will have a material adverse effect on our results of operations, financial position or cash flow. See Note 14 for additional discussion of claims associated with our projects.

Project Arbitration Matter—The customer for one of our large cost-reimbursable projects has filed a request for arbitration with the International Chamber of Commerce, alleging cost overruns on the project, which has been completed. The customer has not provided evidence to substantiate its allegations, and we believe all amounts incurred and billed on the project, including outstanding receivables of approximately $236,000 as of June 30, 2017, are contractually due under the provisions of our contract and are recoverable, but have been classified as a non-current asset on our Balance Sheet as we do not anticipate collection within the next year. We do not believe a risk of material loss is probable related to this matter, and accordingly, no amounts have been accrued. While it is possible that a loss may be incurred, we are unable to estimate the range of potential loss, if any. Further, we have asserted counterclaims for our outstanding receivables.

Dispute Related to Sale of Nuclear Operations—On December 31, 2015, we sold our Nuclear Operations to Westinghouse Electric Company LLC (“WEC”). In connection with the transaction, a post-closing purchase price adjustment mechanism was negotiated between CB&I and WEC to account for any difference between target working capital and actual working capital as finally determined pursuant to the terms of the purchase agreement. On April 28, 2016, WEC delivered to us a purported closing statement that estimated closing working capital was negative$976,506, which was $2,150,506 less than the target working capital amount. In contrast, we calculated closing working capital to be $1,601,805, which was $427,805 greater than the target working capital amount. On July 21, 2016, we filed a complaint against WEC in the Court of Chancery in the State of Delaware seeking a declaration that WEC has no remedy for the vast majority of its claims, and we requested an injunction barring WEC from bringing such claims. On December 2, 2016, the Court of Chancery granted WEC’s motion for judgment on the pleadings and dismissed our complaint, stating that the dispute should follow the dispute resolution process set forth in the purchase agreement, which includes the use of an independent auditor to resolve the working capital dispute. We appealed that ruling to the Delaware Supreme Court. Due to WEC’s bankruptcy filing on March 29, 2017, all claim resolution proceedings were automatically stayed pursuant to the Bankruptcy Code. At the parties’ request, the Bankruptcy Court lifted the automatic stay to permit the appeal and dispute resolution process to continue. Oral argument before the Delaware Supreme Court was held on May 3, 2017, and on June 27, 2017, the Delaware Supreme Court overturned the decision of the Court of Chancery and instructed the Court of Chancery to issue an order enjoining WEC from submitting certain claims to the independent auditor. The parties continue to move forward with those matters still subject to the dispute resolution process and with the selection of a new independent auditor to replace the previous auditor, who had resigned. We do not believe a risk of material loss is probable related to this matter, and, accordingly, no amounts have been accrued. While it is possible that a loss may be incurred, we are unable to estimate the range of potential loss, if any. We believe the Delaware Supreme Court ruling significantly improved our position on this matter and intend to continue pursuing our rights under the purchase agreement.

Asbestos Litigation—We are a defendant in numerous lawsuits wherein plaintiffs allege exposure to asbestos due to work we may have performed at various locations. We have never been a manufacturer, distributor or supplier of asbestos products. Over the past several decades and through June 30, 2017, we have been named a defendant in lawsuits alleging exposure to asbestos involving approximately 6,100 plaintiffs and, of those claims, approximately 1,200 claims were pending and 4,900 have been closed through dismissals or settlements. Over the past several decades and through June 30, 2017, the claims alleging exposure to asbestos that have been resolved have been dismissed or settled for an average settlement amount of approximately two thousand dollars per claim. We review each case on its own merits and make accruals based on the probability of loss and our estimates of the amount of liability and related expenses, if any. Although we have seen an increase in the number of recent filings, especially in one specific venue, we do not believe the increase or any unresolved asserted claims will have a material adverse effect on our future results of operations, financial position or cash flow, and at June 30, 2017, we had approximately $8,300 accrued for liability and related expenses. With respect to unasserted asbestos claims, we cannot identify a population of potential claimants with sufficient certainty to determine the probability of a loss and to make a reasonable estimate of liability, if any. While we continue to pursue recovery for recognized and unrecognized contingent losses through insurance, indemnification arrangements or other sources, we are unable to quantify the amount, if any, that we may expect to recover because of the variability in coverage amounts, limitations and deductibles or the viability of carriers, with respect to our insurance policies for the years in question.

Environmental Matters—Our operations are subject to extensive and changing U.S. federal, state and local laws and regulations, as well as the laws of other countries, that establish health and environmental quality standards. These standards, among others, relate to air and water pollutants and the management and disposal of hazardous substances and wastes. We are exposed to potential liability for personal injury or property damage caused by any release, spill, exposure or other accident involving such pollutants, substances or wastes.

In connection with the historical operation of our facilities, including those associated with acquired operations, substances which currently are or might be considered hazardous were used or disposed of at some sites that will or may require us to make expenditures for remediation. In addition, we have agreed to indemnify parties from whom we have purchased or to whom we have sold facilities for certain environmental liabilities arising from acts occurring before the dates those facilities were transferred.

We believe we are in compliance, in all material respects, with environmental laws and regulations and maintain insurance coverage to mitigate our exposure to environmental liabilities. We do not believe any environmental matters will have a material adverse effect on our future results of operations, financial position or cash flow. We do not anticipate we will incur material capital expenditures for environmental controls or for the investigation or remediation of environmental conditions during the remainder of 2017 or 2018.

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ACCUMULATED OTHER COMPREHENSIVE INCOME

6 Months Ended

Jun. 30, 2017

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME

ACCUMULATED OTHER COMPREHENSIVE INCOME

The following table presents changes in AOCI, net of tax, by component, during the six months ended June 30, 2017:

	Currency Translation Adjustment (1)			Unrealized Fair Value Of Cash Flow Hedges			Defined Benefit Pension and Other Postretirement Plans			Total
Balance at December 31, 2016	$	(264,562	)	$	(213	)	$	(130,841	)	$	(395,616	)
OCI before reclassifications	55,973			942			(10,924		)	45,991
Amounts reclassified from AOCI	—			(132		)	2,859			2,727
Net OCI	55,973			810			(8,065		)	48,718
Balance at June 30, 2017	$	(208,589	)	$	597		$	(138,906	)	$	(346,898	)

⁽¹⁾  During the six months ended June 30, 2017, the currency translation adjustment component of AOCI was favorably impacted by net movements in the Australian Dollar, British Pound, and Euro exchange rates against the U.S. Dollar.

The following table presents reclassification of AOCI into earnings, net of tax, for each component, during the six months ended June 30, 2017:

	Amount Reclassified From AOCI
Unrealized Fair Value Of Cash Flow Hedges (1)
Interest rate derivatives (interest expense)	$	(49	)
Foreign currency derivatives (cost of revenue)	(208		)
Total before tax	$	(257	)
Tax	125
Total net of tax	$	(132	)
Defined Benefit Pension and Other Postretirement Plans (2)
Amortization of prior service credits	$	(306	)
Recognized net actuarial losses	4,155
Total before tax	$	3,849
Tax	(990		)
Total net of tax	$	2,859

⁽¹⁾  See Note 9 for further discussion of our cash flow hedges, including the total value reclassified from AOCI to earnings.

⁽²⁾  See Note 10 for further discussion of our defined benefit and other postretirement plans, including the components of net periodic benefit cost.

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EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY

6 Months Ended

Jun. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY

EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY

General—Under our equity-based incentive plans (our “Incentive Plans”), we can issue shares to employees and directors in the form of restricted stock units (“RSUs”), performance based shares (including those based upon financial or stock price performance) and stock options. Changes in common stock, APIC and treasury stock during the six months ended June 30, 2017 and 2016 primarily relate to activity associated with our Incentive Plans and share repurchases.

Share Grants—During the six months ended June 30, 2017, we had the following share grants associated with our Incentive Plans:

	Shares (1)	Weighted Average Grant-Date Fair Value per Share
RSUs	1,155	$	32.13
Financial performance based shares	597	$	36.00
Stock performance based shares	149	$	44.21
Total shares granted	1,901

⁽¹⁾  No stock options were granted during the six months ended June 30, 2017.

Share Issuances—During the six months ended June 30, 2017, we had the following share issuances associated with our Incentive Plans and employee stock purchase plan (“ESPP”):

	Shares
Financial performance based shares (issued upon vesting)	49
RSUs (issued upon vesting)	867
Stock options (issued upon exercise)	32
ESPP shares (issued upon sale)	239
Total shares issued	1,187

Stock-Based Compensation Expense—During the three months ended June 30, 2017 and 2016, we recognized $16,194 and $6,658, respectively (including $6,198 and $718, respectively, associated with our discontinued Capital Services Operations), of stock-based compensation expense, and during the six months ended June 30, 2017 and 2016, we recognized $26,441 and $21,158, respectively (including $6,874 and $1,640, respectively, associated with our discontinued Capital Services Operations), of stock-based compensation expense, primarily within selling and administrative expense. We recognize forfeitures as they occur, rather than estimating expected forfeitures.

Share Repurchases—During the six months ended June 30, 2017, we repurchased 299 shares for $9,080 (an average price of $30.37) for taxes withheld on taxable share distributions.

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UNAPPROVED CHANGE ORDERS, CLAIMS, INCENTIVES AND OTHER PROJECT MATTERS

6 Months Ended

Jun. 30, 2017

Contractors [Abstract]

UNAPPROVED CHANGE ORDERS, CLAIMS, INCENTIVES AND OTHER PROJECT MATTERS

UNAPPROVED CHANGE ORDERS, CLAIMS, INCENTIVES AND OTHER PROJECT MATTERS

Unapproved Change Orders, Claims and Incentives—We have unapproved change orders and claims (collectively, “Claims”) and incentives included in project price for consolidated and proportionately consolidated projects within our Engineering & Construction and Fabrication Services operating groups.

At June 30, 2017 and December 31, 2016, our pro-rata share of Claims included in project price totaled approximately $520,000 and $121,100, respectively. Our Claims at June 30, 2017 are primarily related to a completed project, a consolidated joint venture project that is substantially complete, and a proportionately consolidated joint venture project. The Claims are primarily associated with schedule related delays and related prolongation costs, fabrication activities and disputes regarding certain reimbursable billings. Approximately $266,200 of the Claim amounts are subject to arbitration or dispute resolution proceedings that are in the early stages and the remainder are subject to early commercial discussions. Further, approximately $456,000 of the Claim amounts had been recognized as revenue on a cumulative POC basis through June 30, 2017. Of the recognized Claim amounts at June 30, 2017, approximately $154,000 had been paid by the respective customers, approximately $39,000 has been reflected within non-current assets on our Balance Sheet as we do not anticipate collection within the next year, and the remainder has been reflected within cost and estimated earnings in excess of billings on our Balance Sheet.

At June 30, 2017 and December 31, 2016, we also had incentives included in project price of approximately $38,200 and $43,000, respectively, for projects within our Engineering & Construction and Fabrication Services operating groups. Approximately $21,300 of such amounts had been recognized as revenue on a cumulative POC basis through June 30, 2017.

The aforementioned amounts recorded in project price and recognized as revenue reflect our best estimate of recovery amounts; however, the ultimate resolution and amounts received could differ from these estimates and could have a material adverse effect on our results of operations, financial position and cash flow. See Note 11 for further discussion of outstanding receivables related to one of our completed large cost-reimbursable projects.

Westinghouse Bankruptcy—At June 30, 2017, we had approximately $31,000 of accounts receivable and unbilled amounts due from Westinghouse. On March 29, 2017, Westinghouse filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code (“Westinghouse Bankruptcy”). We currently do not believe the Westinghouse Bankruptcy will impact the realizability of the receivable amounts and therefore, no amounts have been reserved as of June 30, 2017.

Other—Backlog for each of our operating groups generally consists of several hundred contracts and our results may be impacted by changes in estimated project margins. For the three months ended June 30, 2017, significant changes in estimated margins on four projects resulted in a decrease to our income from operations of approximately $548,000, all within our Engineering & Construction operating group. For the six months ended June 30, 2017, significant changes in estimated margins on the same four projects resulted in a decrease to our income from operations of approximately $715,000, and changes in estimated margins on two projects resulted in an increase to our income from operations of approximately $103,000, all within our Engineering & Construction operating group. For the three and six months ended June 30, 2016, individual projects with significant changes in estimated margins did not have a material net impact on our income from operations.

The two projects that resulted in an increase to our income from operations of approximately $103,000 for the six months ended June 30, 2017, benefited from changes in estimated recoveries during the three months ended March 31, 2017, and included a large consolidated joint venture project and a separate cost reimbursable project.

Loss Projects

Two of the projects that resulted in a decrease to our income from operations for the 2017 periods were in a loss position. For the three and six months ended June 30, 2017, changes in estimates on these projects resulted in a decrease to our income from operations of approximately $181,000 and $324,000, respectively. The loss projects were impacted primarily by lower than anticipated craft labor productivity (including reductions to our forecasted productivity estimates to levels that are in line with our overall historical experience); slower than anticipated benefits from mitigation plans; and further extensions of schedule and related prolongation costs (including schedule liquidated damages) resulting from the aforementioned impacts. At June 30, 2017, one project was approximately 69% complete, had a reserve for estimated losses of approximately $98,000, and is forecasted to be completed in May 2018 (representing a four month extension from our estimates as of March 31, 2017). The other loss project was approximately 86% complete, had a reserve for estimated losses of approximately $23,000, and is forecasted to be completed in November 2017 (representing a two month extension from our estimates as of March 31, 2017). If future direct and subcontract labor productivity differ from our current estimates, our schedules are further extended, or the projects incur increased schedule liquidated damages due to our inability to reach favorable commercial resolution on such matters, the projects would experience further losses.

Proportionately Consolidated JV Projects

The two other projects that resulted in a decrease to our income from operations for the 2017 periods were proportionately consolidated joint venture projects. For the three and six months ended June 30, 2017, changes in estimates on these projects resulted in a decrease to our income from operations of approximately $367,000 and $391,000, respectively.

A majority of the impacts for the 2017 period relate to one of the proportionately consolidated joint venture projects, which was slightly above break-even at June 30, 2017. The project was impacted primarily by lower than anticipated craft labor productivity (including reductions to our forecasted productivity estimates as trending results of certain disciplines provided increased evidence that previously forecasted productivity estimates were unlikely to be achieved); weather related delays; increased material, construction and fabrication costs due to quantity growth and material delivery delays; higher than anticipated estimates from subcontractors for their work scopes; and extensions of schedule and related prolongation costs resulting from the aforementioned. The revised schedule represented a several month extension from our March 31, 2017 estimates for certain LNG trains and the schedule was submitted to the owner during the three months ended June 30, 2017. Our current forecast for the project anticipates improvement in productivity from our overall historical experience (as we make progress on each LNG train) through modified execution plans, and actions to reduce our schedule related costs. The aforementioned impact for the six months ended June 30, 2017 includes the benefit of an increase in project price for claims on the project during the three months ended March 31, 2017.

The remaining impacts for the 2017 period relate to the other proportionately consolidated joint venture project, which was impacted primarily by increased material, construction and fabrication costs due to quantity growth and material delivery delays, and potential extensions of schedule and related prolongation costs resulting from the aforementioned.

If future direct and subcontract labor productivity differ from our current estimates, our schedules are further extended, or the projects incur schedule liquidated damages due to our inability to reach favorable legal or commercial resolution on such matters, the projects would experience further decreases in estimated margins.

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SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

Our management structure and internal and public segment reporting are aligned based upon the services offered by our three operating groups, which represent our reportable segments: Engineering & Construction; Fabrication Services; and Technology. Our chief operating decision maker evaluates the performance of the aforementioned operating groups based upon revenue and income from operations. Each operating group’s income from operations reflects corporate costs, allocated based primarily upon revenue. Intersegment revenue for our continuing operations is netted against the revenue of the segment receiving the intersegment services. For the three months ended June 30, 2017 and 2016, intersegment revenue totaled approximately $152,700 and $66,700, respectively, and for the six months ended June 30, 2017 and 2016, intersegment revenue totaled approximately $294,100 and $107,600, respectively. Intersegment revenue for the aforementioned periods primarily related to services provided by our Fabrication Services operating group to our Engineering & Construction operating group.

As a result of the classification of our Capital Services Operations (which was primarily comprised of our former Capital Services reportable segment) as a discontinued operation, the 2016 information for our remaining segments presented below has been recast to reflect: 1) a reallocation of certain corporate amounts previously allocated to the Capital Services segment that were not assignable to the discontinued operation, and 2) the portions of the previously reported Capital Services segment that were not included in the Capital Services Operations and the portions of other segments that were included in the Capital Services Operations. In addition, revenue for the remaining segments has been recast to reflect the intersegment revenue with our Capital Services Operations that was previously eliminated prior to the discontinued operations classification (approximately $18,500 and $25,200 for the three months ended June 30, 2017 and 2016, respectively, and approximately $34,400 and $57,100 for the six months ended June 30, 2017 and 2016, respectively).

The following table presents total revenue and income from operations by reportable segment for the three and six months ended June 30, 2017 and 2016:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
Revenue
Engineering & Construction	$	702,150		$	1,548,994	$	1,982,903		$	3,085,355
Fabrication Services	508,518			547,658		987,090			1,081,364
Technology	72,809			64,512		140,836			129,074
Total revenue	$	1,283,477		$	2,161,164	$	3,110,829		$	4,295,793
Operating (Loss) Income From Continuing Operations
Engineering & Construction	$	(525,682	)	$	92,809	$	(520,268	)	$	200,882
Fabrication Services	57,639			67,385		109,698			104,495
Technology	21,460			23,054		42,975			49,203
Total operating (loss) income from continuing operations	$	(446,583	)	$	183,248	$	(367,595	)	$	354,580

The following table presents total assets by reportable segment at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Assets
Engineering & Construction	$	3,694,396	$	3,572,399
Fabrication Services	2,465,398		2,394,041
Technology	986,485		996,104
Total assets of continuing operations	7,146,279		6,962,544
Assets of discontinued operations (Note 4)	—		876,876
Total assets	$	7,146,279	$	7,839,420

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Subsequent Event

6 Months Ended

Jun. 30, 2017

Subsequent Events [Abstract]

Subsequent Event

SUBSEQUENT EVENT

Amendments to Debt and Credit Facility Agreements—Effective August 9, 2017, and effective for the period ended June 30, 2017, we are amending our Senior Facilities, subject to final documentation. See Note 8 for additional discussion.

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

Basis of Accounting

The accompanying unaudited interim Condensed Consolidated Financial Statements (“Financial Statements”) are prepared in accordance with the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (the “SEC”) and accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Consolidation

These Financial Statements include all wholly-owned subsidiaries and those entities which we are required to consolidate. See the “Partnering Arrangements” section of this footnote for further discussion of our consolidation policy for those entities that are not wholly-owned. Intercompany balances and transactions are eliminated in consolidation.

Discontinued Operations, Policy

On February 27, 2017, we entered into a definitive agreement (the “CS Agreement”) with CSVC Acquisition Corp (“CSVC”), under which CSVC agreed to acquire our capital services operations, which are primarily comprised of our former Capital Services reportable segment and provides comprehensive and integrated maintenance services, environmental engineering and remediation, construction services, program management, and disaster response and recovery services for private-sector customers and governments (the “Capital Services Operations”). We completed the sale of our Capital Services Operations on June 30, 2017 (the “Closing Date”). We considered the Capital Services Operations to be a discontinued operation in the first quarter 2017, as the divestiture represented a strategic shift and will have a material effect on our operations and financial results. Operating results of the Capital Services Operations have been classified as a discontinued operation within the Condensed Consolidated Statements of Operations (the “Statement of Operations”) for the three and six months ended June 30, 2017 and 2016. Further, the assets and liabilities of the Capital Services Operations have been classified as assets and liabilities of discontinued operations within our December 31, 2016 Balance Sheet, and our June 30, 2017 Balance Sheet reflects the impact of the sale. Cash flows of the Capital Services Operations are not reported separately within our Condensed Consolidated Statements of Cash flows. Unless otherwise noted, the footnotes to our Financial Statements relate to our continuing operations.

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

The accompanying unaudited interim Condensed Consolidated Financial Statements (“Financial Statements”) are prepared in accordance with the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (the “SEC”) and accounting principles generally accepted in the United States of America (“U.S. GAAP”). These Financial Statements include all wholly-owned subsidiaries and those entities which we are required to consolidate. See the “Partnering Arrangements” section of this footnote for further discussion of our consolidation policy for those entities that are not wholly-owned. Intercompany balances and transactions are eliminated in consolidation.

Basis of Presentation—We believe these Financial Statements include all adjustments, which are of a normal recurring nature, necessary for a fair presentation of our results of operations for the three and six months ended June 30, 2017 and 2016, our financial position as of June 30, 2017 and our cash flows for the six months ended June 30, 2017 and 2016. The December 31, 2016 Condensed Consolidated Balance Sheet (the “Balance Sheet”) was derived from our December 31, 2016 audited Consolidated Balance Sheet, adjusted to conform to our current year presentation.

On February 27, 2017, we entered into a definitive agreement (the “CS Agreement”) with CSVC Acquisition Corp (“CSVC”), under which CSVC agreed to acquire our capital services operations, which are primarily comprised of our former Capital Services reportable segment and provides comprehensive and integrated maintenance services, environmental engineering and remediation, construction services, program management, and disaster response and recovery services for private-sector customers and governments (the “Capital Services Operations”). We completed the sale of our Capital Services Operations on June 30, 2017 (the “Closing Date”). We considered the Capital Services Operations to be a discontinued operation in the first quarter 2017, as the divestiture represented a strategic shift and will have a material effect on our operations and financial results. Operating results of the Capital Services Operations have been classified as a discontinued operation within the Condensed Consolidated Statements of Operations (the “Statement of Operations”) for the three and six months ended June 30, 2017 and 2016. Further, the assets and liabilities of the Capital Services Operations have been classified as assets and liabilities of discontinued operations within our December 31, 2016 Balance Sheet, and our June 30, 2017 Balance Sheet reflects the impact of the sale. Cash flows of the Capital Services Operations are not reported separately within our Condensed Consolidated Statements of Cash flows. Unless otherwise noted, the footnotes to our Financial Statements relate to our continuing operations. See Note 4 for additional discussion of our discontinued operations and the impact of the sale of the Capital Services Operations.

In July 2017, we initiated a plan to market and sell our Technology operations (primarily comprised of our Technology reportable segment) and Engineered Products operations (representing a portion of our Fabrication Services reportable segment) (collectively, the “Technology Operations”), the proceeds of which will be used to significantly reduce our outstanding debt. We anticipate classifying the Technology Operations as held for sale during the third quarter 2017.

We believe the disclosures accompanying these Financial Statements are adequate to make the information presented not misleading. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC for interim reporting periods. The results of operations and cash flows for the interim periods are not necessarily indicative of the results to be expected for the full year. The accompanying Financial Statements should be read in conjunction with our Consolidated Financial Statements and notes thereto included in our 2016 Annual Report on Form 10-K (“2016 Annual Report”).

Use of Estimates

Use of Estimates—The preparation of our Financial Statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. We believe the most significant estimates and judgments are associated with revenue recognition for our contracts, including estimating costs and the recognition of incentive fees and unapproved change orders and claims; fair value and recoverability assessments that must be periodically performed with respect to long-lived tangible assets, goodwill and other intangible assets; valuation of deferred tax assets and financial instruments; the determination of liabilities related to self-insurance programs and income taxes; and consolidation determinations with respect to our partnering arrangements. If the underlying estimates and assumptions upon which our Financial Statements are based change in the future, actual amounts may differ from those included in the accompanying Financial Statements.

Revenue Recognition

Revenue Recognition—Our revenue is primarily derived from long-term contracts and is generally recognized using the percentage of completion (“POC”) method, primarily based on the percentage that actual costs-to-date bear to total estimated costs to complete each contract. We follow the guidance of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Revenue Recognition Topic 605-35 for accounting policies relating to our use of the POC method, estimating costs, and revenue recognition, including the recognition of incentive fees, unapproved change orders and claims, and combining and segmenting contracts. We primarily utilize the cost-to-cost approach to estimate POC as we believe this method is less subjective than relying on assessments of physical progress. Under the cost-to-cost approach, the use of estimated costs to complete each contract is a significant variable in the process of determining recognized revenue and is a significant factor in the accounting for contracts. Significant estimates that impact the cost to complete each contract are costs of engineering, materials, components, equipment, labor and subcontracts; labor productivity; schedule durations, including subcontractor or supplier progress; liquidated damages; contract disputes, including claims; achievement of contractual performance requirements; and contingency, among others. The cumulative impact of revisions in total cost estimates during the progress of work is reflected in the period in which these changes become known, including, to the extent required, the reversal of profit recognized in prior periods and the recognition of losses expected to be incurred on contracts in progress. Due to the various estimates inherent in our contract accounting, actual results could differ from those estimates. See Note 14 for discussion of projects with significant changes in estimated margins during the three and six months ended June 30, 2017 and 2016.

Our long-term contracts are awarded on a competitively bid and negotiated basis and the timing of revenue recognition may be impacted by the terms of such contracts. We use a range of contracting options, including cost-reimbursable, fixed-price and hybrid, which has both cost-reimbursable and fixed-price characteristics. Fixed-price contracts, and hybrid contracts with a more significant fixed-price component, tend to provide us with greater control over project schedule and the timing of when work is performed and costs are incurred, and accordingly, when revenue is recognized. Cost-reimbursable contracts, and hybrid contracts with a more significant cost-reimbursable component, generally provide our customers with greater influence over the timing of when we perform our work, and accordingly, such contracts often result in less predictability with respect to the timing of revenue recognition. Contract revenue for our long-term contracts recognized under the POC method reflects the original contract price adjusted for approved change orders and estimated recoveries for incentive fees, unapproved change orders and claims, and liquidated damages. We recognize revenue associated with incentive fees when the value can be reliably estimated and recovery is probable. We recognize revenue associated with unapproved change orders and claims to the extent the related costs have been incurred, the value can be reliably estimated and recovery is probable. Our recorded incentive fees, unapproved change orders and claims reflect our best estimate of recovery amounts; however, the ultimate resolution and amounts received could differ from these estimates. Liquidated damages are reflected as a reduction to contract price to the extent they are deemed probable. See Note 14 for additional discussion of our recorded unapproved change orders, claims and incentives.

With respect to our engineering, procurement, and construction (“EPC”) services, our contracts are not segmented between types of services, such as engineering and construction, if each of the EPC components is negotiated concurrently or if the pricing of any such services is subject to the ultimate negotiation and agreement of the entire EPC contract. However, an EPC contract including technology or fabrication services may be segmented if we satisfy the segmenting criteria in ASC 605-35. Revenue recorded in these situations is based on our prices and terms for similar services to third party customers. Segmenting a contract may result in different interim rates of profitability for each scope of service than if we had recognized revenue without segmenting. In some instances, we may combine contracts that are entered into in multiple phases, but are interdependent and include pricing considerations by us and the customer that are impacted by all phases of the project. Otherwise, if each phase is independent of the other and pricing considerations do not give effect to another phase, the contracts will not be combined.

Cost of revenue for our long-term contracts includes direct contract costs, such as materials and labor, and indirect costs that are attributable to contract activity. The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Projects with costs and estimated earnings recognized to date in excess of cumulative billings is reported on the Balance Sheet as costs and estimated earnings in excess of billings. Projects with cumulative billings in excess of costs and estimated earnings recognized to date is reported on the Balance Sheet as billings in excess of costs and estimated earnings.

Receivables

Any uncollected billed amounts, including contract retentions, are reported as accounts receivable. At June 30, 2017 and December 31, 2016, accounts receivable included contract retentions of approximately $64,500 and $72,100, respectively. Contract retentions due beyond one year were approximately $46,600 and $37,500 at June 30, 2017 and December 31, 2016, respectively.

Revenue for our service contracts that do not satisfy the criteria for revenue recognition under the POC method is recorded at the time services are performed. Revenue associated with incentive fees for these contracts is recognized when earned. Unbilled receivables for our service contracts are recorded within accounts receivable and were approximately $9,600 and $16,100 at June 30, 2017 and December 31, 2016, respectively.

Revenue for our pipe and steel fabrication and catalyst manufacturing contracts that are independent of an EPC contract, or for which we satisfy the segmentation criteria discussed above, is recognized upon shipment of the fabricated or manufactured units. During the fabrication or manufacturing process, all related direct and allocable indirect costs are capitalized as work in process inventory and such costs are recorded as cost of revenue at the time of shipment.

Our billed and unbilled revenue may be exposed to potential credit risk if our customers should encounter financial difficulties, and we maintain reserves for specifically-identified potential uncollectible receivables. At June 30, 2017 and December 31, 2016, our allowances for doubtful accounts were not material.

Other Operating Expense (Income), Net

Other Operating Expense (Income), Net—Other operating expense (income), net generally represents (gains) losses associated with the sale or disposition of property and equipment. For the three and six months ended June 30, 2017, other operating (income) expense, net also included accrued future operating lease expense for vacated facility capacity where we remain contractually obligated to a lessor of approximately $3,000.

Recoverability of Goodwill and Recoverability of Other Long-Lived Assets

Recoverability of Goodwill—Goodwill is not amortized to earnings, but instead is reviewed for impairment at least annually at a reporting unit level, absent any indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based upon balances as of October 1. We identify a potential impairment by comparing the fair value of the applicable reporting unit to its net book value, including goodwill. If the net book value exceeds the fair value of the reporting unit, an indication of potential impairment exists, and we measure the impairment by comparing the carrying value of the reporting unit’s goodwill to its implied fair value. To determine the fair value of our reporting units and test for impairment, we utilize an income approach (discounted cash flow method) as we believe this is the most direct approach to incorporate the specific economic attributes and risk profiles of our reporting units into our valuation model. This is consistent with the methodology used to determine the fair value of our reporting units in previous years. We generally do not utilize a market approach given the lack of relevant information generated by market transactions involving comparable businesses. However, to the extent market indicators of fair value become available, we consider such market indicators in our discounted cash flow analysis and determination of fair value. See Note 6 for additional discussion of our goodwill.

Recoverability of Other Long-Lived Assets—We amortize our finite-lived intangible assets on a straight-line basis with lives ranging from 6 to 20 years, absent any indicators of impairment. We review tangible assets and finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If a recoverability assessment is required, the estimated future cash flow associated with the asset or asset group will be compared to their respective carrying amounts to determine if an impairment exists.

Earnings Per Share ("EPS")

Earnings Per Share (“EPS”)—Basic EPS is calculated by dividing net income attributable to CB&I by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the assumed conversion of dilutive securities, consisting of restricted shares, performance based shares (where performance criteria have been met), stock options and directors’ deferred-fee shares.

Cash Equivalents

Cash Equivalents—Cash equivalents are considered to be highly liquid securities with original maturities of three months or less.

Inventory

Inventory—Inventory is recorded at the lower of cost and net realizable value and cost is determined using the first-in-first-out or weighted-average cost method. The cost of inventory includes acquisition costs, production or conversion costs, and other costs incurred to bring the inventory to a current location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. An allowance for excess or inactive inventory is recorded based upon an analysis that considers current inventory levels, historical usage patterns, estimates of future sales expectations and salvage value.

Foreign Currency

Foreign Currency—The nature of our business activities involves the management of various financial and market risks, including those related to changes in foreign currency exchange rates. The effects of translating financial statements of foreign operations into our reporting currency are recognized as a cumulative translation adjustment in accumulated other comprehensive income (loss) (“AOCI”) which is net of tax, where applicable. Foreign currency transactional and re-measurement exchange gains (losses) are included within cost of revenue and were not material for the three and six months ended June 30, 2017 and 2016.

Financial Instruments

Financial Instruments—We do not engage in currency speculation; however, we utilize foreign currency exchange rate derivatives on an ongoing basis to hedge against certain foreign currency related operating exposures. We generally seek hedge accounting treatment for contracts used to hedge operating exposures and designate them as cash flow hedges. Therefore, gains and losses, exclusive of credit risk and forward points (which represent the time value component of the fair value of our derivative positions), are included in AOCI until the associated underlying operating exposure impacts our earnings. Changes in the fair value of (1) credit risk and forward points, (2) instruments deemed ineffective during the period, and (3) instruments that we do not designate as cash flow hedges are recognized within cost of revenue.

For those contracts designated as cash flow hedges, we document all relationships between the derivative instruments and associated hedged items, as well as our risk-management objectives and strategy for undertaking hedge transactions. This process includes linking all derivatives to specific firm commitments or highly-probable forecasted transactions. We continually assess, at inception and on an ongoing basis, the effectiveness of derivative instruments in offsetting changes in the cash flow of the designated hedged items. Hedge accounting designation is discontinued when (1) it is determined that the derivative is no longer highly effective in offsetting changes in the cash flow of the hedged item, including firm commitments or forecasted transactions, (2) the derivative is sold, terminated, exercised, or expires, (3) it is no longer probable that the forecasted transaction will occur, or (4) we determine that designating the derivative as a hedging instrument is no longer appropriate.

Income Taxes

Income Taxes—Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis using currently enacted income tax rates for the years in which the differences are expected to reverse. A valuation allowance (“VA”) is provided to offset any net deferred tax assets (“DTA(s)”) if, based upon the available evidence, it is more likely than not that some or all of the DTAs will not be realized. The realization of our net DTAs depends upon our ability to generate sufficient future taxable income of the appropriate character and in the appropriate jurisdictions.

Income tax and associated interest and penalty reserves, where applicable, are recorded in those instances where we consider it more likely than not that additional tax will be due in excess of amounts reflected in income tax returns filed worldwide, irrespective of whether or not we have received tax assessments. We continually review our exposure to additional income tax obligations and, as further information is known or events occur, changes in our tax and penalty reserves may be recorded within income tax expense and changes in interest reserves may be recorded in interest expense.

Partnering Arrangements

Partnering Arrangements—In the ordinary course of business, we execute specific projects and conduct certain operations through joint venture, consortium and other collaborative arrangements (collectively referred to as “venture(s)”). We have various ownership interests in these ventures, with such ownership typically proportionate to our decision making and distribution rights. The ventures generally contract directly with the third party customer; however, services may be performed directly by the ventures, or may be performed by us, our partners, or a combination thereof.

Venture net assets consist primarily of working capital and property and equipment, and assets may be restricted from being used to fund obligations outside of the venture. These ventures typically have limited third party debt or have debt that is non-recourse in nature; however, they may provide for capital calls to fund operations or require participants in the venture to provide additional financial support, including advance payment or retention letters of credit.

Each venture is assessed at inception and on an ongoing basis as to whether it qualifies as a VIE under the consolidations guidance in ASC 810. A venture generally qualifies as a VIE when it (1) meets the definition of a legal entity, (2) absorbs the operational risk of the projects being executed, creating a variable interest, and (3) lacks sufficient capital investment from the partners, potentially resulting in the venture requiring additional subordinated financial support, if necessary, to finance its future activities.

If at any time a venture qualifies as a VIE, we perform a qualitative assessment to determine whether we are the primary beneficiary of the VIE and, therefore, need to consolidate the VIE. We are the primary beneficiary if we have (1) the power to direct the economically significant activities of the VIE and (2) the right to receive benefits from, and obligation to absorb losses of, the VIE. If the venture is a VIE and we are the primary beneficiary, or we otherwise have the ability to control the venture, we consolidate the venture. If we are not determined to be the primary beneficiary of the VIE, or only have the ability to significantly influence, rather than control the venture, we do not consolidate the venture. We account for unconsolidated ventures using either proportionate consolidation for both the Balance Sheet and Statement of Operations, when we meet the applicable accounting criteria to do so, or utilize the equity method.

New Accounting Standards

New Accounting Standards—In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, which provides a single comprehensive accounting standard for revenue recognition for contracts with customers and supersedes current industry-specific guidance, including ASC 605-35. The new standard prescribes a five-step revenue recognition model that focuses on transfer of control and entitlement to payment when determining the amount of revenue to be recognized. The new model requires companies to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time for each of these obligations. These concepts, as well as other aspects of the ASU, may change the method and/or timing of revenue recognition for certain of our contracts, primarily associated with our fabrication and manufacturing contracts. We expect that revenue generated from our EPC and engineering services contracts will continue to be recognized over time utilizing the cost-to-cost measure of progress consistent with current practice. We also expect our revenue recognition disclosures to significantly expand due to the new qualitative and quantitative requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from our contracts. We will adopt the standard, including any updates to the standard, upon its effective date in the first quarter 2018 utilizing the modified retrospective approach. This approach will result in a cumulative adjustment to beginning equity in the first quarter 2018 for uncompleted contracts impacted by the adoption of the standard. We are continuing to assess the potential impact of the new standard on our Financial Statements.

In February 2016, the FASB issued ASU 2016-02, which requires the recognition of a right-of-use asset and a lease liability for most lease arrangements with a term greater than one year, and increases qualitative and quantitative disclosures regarding leasing transactions. The standard is effective for us in the first quarter 2019, although early adoption is permitted. Transition requires application of the new guidance at the beginning of the earliest comparative balance sheet period presented utilizing a modified retrospective approach. We are assessing the timing of adoption of the new standard and its potential impact on our Financial Statements.

In the first quarter 2017, we adopted ASU 2015-11, which simplifies the subsequent measurement of our inventory by requiring inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Our adoption of the standard did not have a material impact on our Financial Statements.

In the first quarter 2017, we adopted ASU 2016-09, which modified the accounting for excess tax benefits and tax deficiencies associated with share-based payments, amended the associated cash flow presentation, and allows for forfeitures to be either recognized when they occur, or estimated. ASU 2016-09 eliminated the requirement to recognize excess tax benefits in additional paid-in capital (“APIC”), and the requirement to evaluate tax deficiencies for APIC or income tax expense classification, and provided for these benefits or deficiencies to be recorded as an income tax expense or benefit in the Statement of Operations. Additionally, tax benefits of dividends on share-based payment awards are reflected as an income tax expense or benefit in the income statement. With these changes, tax-related cash flows resulting from share-based payments are classified as operating activities as opposed to financing, as previously presented. We have elected to recognize forfeitures as they occur, rather than estimating expected forfeitures. Our adoption of the standard did not have a material impact on our Financial Statements.

In the first quarter 2017, the FASB issued, and we early adopted, ASU 2017-04, which eliminated the second step of the goodwill impairment test that required a hypothetical purchase price allocation. ASU 2017-04 requires that if a reporting unit’s carrying value exceeds its fair value, an impairment charge would be recognized for the excess amount, not to exceed the carrying amount of goodwill. Our early adoption of the standard in the first quarter 2017 did not have a material impact on our Financial Statements.

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SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

Costs in Excess of Billings and Billings in Excess of Costs

The net balances on our Balance Sheet are collectively referred to as Contracts in Progress, net and the components of these balances at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017						December 31, 2016
	Asset			Liability			Asset			Liability
Costs and estimated earnings on contracts in progress	$	4,334,524		$	28,697,752		$	8,466,638		$	23,408,316
Billings on contracts in progress	(3,916,486		)	(30,402,216		)	(8,055,889		)	(24,803,665		)
Contracts in progress, net	$	418,038		$	(1,704,464	)	$	410,749		$	(1,395,349	)

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EARNINGS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Reconciliation of Weighted Average Basic Shares Outstanding to Diluted Shares Outstanding and Computation of Basic and Diluted EPS

A reconciliation of weighted average basic shares outstanding to weighted average diluted shares outstanding and the computation of basic and diluted EPS are as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
Net (loss) income from continuing operations attributable to CB&I (net of $2,452, $8,272, $29,289 and $20,861 of noncontrolling interests)	$	(304,115	)	$	115,597	$	(288,541	)	$	216,931
Net (loss) income from discontinued operations attributable to CB&I (net of $457, $437, $870 and $885 of noncontrolling interests)	(121,304		)	8,242		(112,223		)	13,833
Net (loss) income attributable to CB&I	$	(425,419	)	$	123,839	$	(400,764	)	$	230,764
Weighted average shares outstanding—basic	100,866			105,298		100,660			105,051
Effect of restricted shares/performance based shares/stock options (1)	—			780		—			861
Effect of directors’ deferred-fee shares (1)	—			13		—			13
Weighted average shares outstanding—diluted	100,866			106,091		100,660			105,925
Net (loss) income attributable to CB&I per share (Basic):
Continuing operations	$	(3.02	)	$	1.10	$	(2.87	)	$	2.07
Discontinued operations	(1.20		)	0.08		(1.11		)	0.13
Total	$	(4.22	)	$	1.18	$	(3.98	)	$	2.20
Net (loss) income attributable to CB&I per share (Diluted):
Continuing operations	$	(3.02	)	$	1.09	$	(2.87	)	$	2.05
Discontinued operations	(1.20		)	0.08		(1.11		)	0.13
Total	$	(4.22	)	$	1.17	$	(3.98	)	$	2.18

⁽¹⁾ The effect of restricted shares, performance based shares, stock options and directors’ deferred-fee shares were not included in the calculation of diluted EPS for the three and six months ended June 30, 2017 due to the net loss for the periods. Antidilutive shares excluded from diluted EPS were not material for the three and six months ended June 30, 2016.

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DISPOSITION OF CAPITAL SERVICES OPERATIONS (Tables)

6 Months Ended

Jun. 30, 2017

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations

Assets and Liabilities—The carrying values of the major classes of assets and liabilities of the discontinued Capital Services Operations included within our Balance Sheet on December 31, 2016 were as follows:

	December 31, 2016
Assets
Cash	$	14,477
Accounts receivable, net	239,146
Costs and estimated earnings in excess of billings	153,275
Other assets	7,834
Current assets of discontinued operations	414,732
Property and equipment, net	59,746
Goodwill (1)	229,607
Other intangibles, net	148,440
Other assets	24,351
Non-current assets of discontinued operations	462,144
Total assets of discontinued operations	$	876,876
Liabilities
Accounts payable	$	141,028
Billings in excess of costs and estimated earnings	53,986
Other liabilities	52,455
Current liabilities of discontinued operations	247,469
Other liabilities	5,388
Non-current liabilities of discontinued operations	5,388
Total liabilities of discontinued operations	$	252,857
Noncontrolling interests of discontinued operations	$	6,874

⁽¹⁾  The carrying value of goodwill for the Capital Services Operations includes the impact of a $655,000 impairment charge recorded in the fourth quarter 2016 in connection with our annual impairment assessment.

Disposal Group, Including Discontinued Operations, Results of Operations

Results of Operations—The results of our Capital Services Operations which have been reflected within discontinued operations in our Statement of Operations for the three and six months ended June 30, 2017 and 2016 were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Revenue	$	561,708		$	559,690		$	1,114,655		$	1,124,671
Cost of revenue	528,927			523,119			1,047,614			1,056,065
Gross profit	32,781			36,571			67,041			68,606
Selling and administrative expense	16,503			13,536			29,541			25,187
Intangibles amortization	—			4,030			2,550			8,230
Loss on net assets sold	64,817			—			64,817			—
Other operating expense (income)	876			120			504			(304		)
Operating (loss) income from discontinued operations	(49,415		)	18,885			(30,371		)	35,493
Interest expense (1)	(6,577		)	(5,877		)	(13,440		)	(11,710		)
Interest income	7			305			16			614
(Loss) income from discontinued operations before taxes	(55,985		)	13,313			(43,795		)	24,397
Income tax expense (2)	(64,862		)	(4,634		)	(67,558		)	(9,679		)
Net (loss) income from discontinued operations	(120,847		)	8,679			(111,353		)	14,718
Net income from discontinued operations attributable to noncontrolling interests	(457		)	(437		)	(870		)	(885		)
Net (loss) income from discontinued operations attributable to CB&I	$	(121,304	)	$	8,242		$	(112,223	)	$	13,833

⁽¹⁾ Interest expense was allocated to the Capital Services Operations due to a requirement to use the proceeds of the transaction to repay our debt. Proceeds from the transaction were initially used to repay our revolving facility borrowings as of June 30, 2017. The revolving facility was subsequently utilized to repay a portion of our senior notes in July 2017, as described in Note 8. The allocation of interest expense was based upon the debt amounts to be repaid.

Disposal Group, Including Discontinued Operations, Cash Flows

Cash flows for our Capital Services Operations for the six months ended June 30, 2017 and 2016 were as follows:

	Six Months Ended June 30,
	2017			2016
Operating cash flows	$	(36,469	)	$	28,470
Investing cash flows	$	(1,459	)	$	(2,495	)

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INVENTORY (Tables)

6 Months Ended

Jun. 30, 2017

Inventory Disclosure [Abstract]

Components of Inventory

The components of inventory at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017		December 31, 2016
Raw materials	$	97,231	$	65,969
Work in process	28,717		51,625
Finished goods	32,870		72,508
Total	$	158,818	$	190,102

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GOODWILL AND OTHER INTANGIBLES (Tables)

6 Months Ended

Jun. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The change in goodwill for the six months ended June 30, 2017 is as follows:

	Total
Balance at December 31, 2016	$	2,813,803
Foreign currency translation and other	16,596
Amortization of tax goodwill in excess of book goodwill	(1,185		)
Balance at June 30, 2017 (1)	$	2,829,214

⁽¹⁾  At June 30, 2017, we had approximately $453,100 of cumulative impairment losses which were recorded in our Engineering & Construction operating group during 2015 related to the sale of our nuclear power construction business (our “Nuclear Operations”) on December 31, 2015.

Summary of Acquired Finite-Lived Intangible Assets, Including Weighted-Average Useful Lives

The following table presents our acquired finite-lived intangible assets at June 30, 2017 and December 31, 2016, including the June 30, 2017 weighted-average useful lives for each major intangible asset class and in total:

		June 30, 2017					December 31, 2016
	Weighted Average Life	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Backlog and customer relationships	18 Years	$	99,086	$	(24,143	)	$	99,086	$	(21,374	)
Process technologies	15 Years	263,043		(140,717		)	258,516		(129,261		)
Tradenames	12 Years	27,327		(16,208		)	27,090		(14,648		)
Total (1)	16 Years	$	389,456	$	(181,068	)	$	384,692	$	(165,283	)

⁽¹⁾  The decrease in other intangibles, net during the six months ended June 30, 2017 primarily related to amortization expense of approximately $12,900.

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PARTNERING ARRANGEMENTS (Tables)

6 Months Ended

Jun. 30, 2017

Equity Method Investments and Joint Ventures [Abstract]

Balance Sheet Information of Proportionately Consolidated Variable Interest Entities

The following table presents summarized balance sheet information for our share of our proportionately consolidated ventures at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
CB&I/Zachry
Current assets (1)	$	251,237	$	260,934
Non-current assets	2,678		3,204
Total assets	$	253,915	$	264,138
Current liabilities (1)	$	387,466	$	379,339
CB&I/Zachry/Chiyoda
Current assets (1)	$	88,593	$	84,279
Non-current assets	1,539		1,969
Total assets	$	90,132	$	86,248
Current liabilities (1)	$	68,305	$	73,138
CB&I/Chiyoda
Current assets (1)	$	186,278	$	337,479
Current liabilities (1)	$	258,367	$	150,179

⁽¹⁾  Our venture arrangements allow for excess working capital of the ventures to be advanced to the venture partners. Such advances are returned to the ventures for working capital needs as necessary. Accordingly, at a reporting period end a venture may have advances to its partners which are reflected as an advance receivable within current assets of the venture. At June 30, 2017 and December 31, 2016, other current assets on the Balance Sheet included approximately $324,400 and $374,800, respectively, related to our proportionate share of advances from the ventures to our venture partners, and other current liabilities included approximately $347,300 and $394,400, respectively, related to advances to CB&I from the ventures.

^[1]

Summarized Balance Sheet Information of Variable Interest Entities

The following table presents summarized balance sheet information for our consolidated ventures at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
CB&I/Kentz
Current assets	$	26,486	$	68,867
Non-current assets	69,404		—
Total assets	$	95,890	$	68,867
Current liabilities	$	27,581	$	87,822
CB&I/AREVA
Current assets	$	24,416	$	16,313
Current liabilities	$	50,086	$	47,652
All Other (1)
Current assets	$	33,099	$	69,785
Non-current assets	16,003		16,382
Total assets	$	49,102	$	86,167
Current liabilities	$	8,514	$	7,748

⁽¹⁾  Other ventures that we consolidate are not individually material to our financial results and are therefore aggregated as “All Other”.

[1] Our venture arrangements allow for excess working capital of the ventures to be advanced to the venture partners. Such advances are returned to the ventures for working capital needs as necessary. Accordingly, at a reporting period end a venture may have advances to its partners which are reflected as an advance receivable within current assets of the venture. At June 30, 2017 and December 31, 2016, other current assets on the Balance Sheet included approximately $324,400 and $374,800, respectively, related to our proportionate share of advances from the ventures to our venture partners, and other current liabilities included approximately $347,300 and $394,400, respectively, related to advances to CB&I from the ventures.

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DEBT (Tables)

6 Months Ended

Jun. 30, 2017

Debt Disclosure [Abstract]

Summary of Outstanding Debt

Our outstanding debt at June 30, 2017 and December 31, 2016 was as follows:

	June 30, 2017			December 31, 2016
Current
Revolving facility and other short-term borrowings	$	374,000		$	407,500
Current maturities of long-term debt	1,481,250			506,250
Less: unamortized debt issuance costs	(11,930		)	(2,340		)
Current maturities of long-term debt, net of unamortized debt issuance costs	1,469,320			503,910
Current debt, net of unamortized debt issuance costs	$	1,843,320		$	911,410
Long-Term
Term Loan: $1,000,000 term loan (interest at LIBOR plus a floating margin)	$	—		$	300,000
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)	481,250			500,000
Senior Notes: $800,000 senior notes, series A-D (fixed interest ranging from 4.65% to 5.80%)	800,000			800,000
Second Senior Notes: $200,000 senior notes (fixed interest of 5.03%)	200,000			200,000
Less: unamortized debt issuance costs	—			(5,827		)
Less: current maturities of long-term debt	(1,481,250		)	(506,250		)
Long-term debt, net of unamortized debt issuance costs	$	—		$	1,287,923

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FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial Instruments Carried at Fair Value

The following table presents the fair value of our foreign currency exchange rate derivatives and interest rate derivatives at June 30, 2017 and December 31, 2016, respectively, by valuation hierarchy and balance sheet classification:

	June 30, 2017										December 31, 2016
	Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3		Total
Derivative Assets (1)
Other current assets	$	—	$	4,766		$	—	$	4,766		$	—	$	1,146		$	—	$	1,146
Other non-current assets	—		561			—		561			—		82			—		82
Total assets at fair value	$	—	$	5,327		$	—	$	5,327		$	—	$	1,228		$	—	$	1,228
Derivative Liabilities
Other current liabilities	$	—	$	(551	)	$	—	$	(551	)	$	—	$	(3,509	)	$	—	$	(3,509	)
Other non-current liabilities	—		(908		)	—		(908		)	—		(725		)	—		(725		)
Total liabilities at fair value	$	—	$	(1,459	)	$	—	$	(1,459	)	$	—	$	(4,234	)	$	—	$	(4,234	)

⁽¹⁾  We are exposed to credit risk on our hedging instruments associated with potential counterparty non-performance, and the fair value of our derivatives reflects this credit risk. The total level 2 assets at fair value above represent the maximum loss that we would incur on our outstanding hedges if the applicable counterparties failed to perform according to the hedge contracts. To help mitigate counterparty credit risk, we transact only with counterparties that are rated as investment grade or higher and monitor all counterparties on a continuous basis.

Total Fair Value by Underlying Risk and Balance Sheet Classification

The following table presents the total fair value by underlying risk and balance sheet classification for derivatives designated as cash flow hedges and derivatives not designated as cash flow hedges at June 30, 2017 and December 31, 2016:

	Other Current and Non-Current Assets				Other Current and Non-Current Liabilities
	June 30, 2017		December 31, 2016		June 30, 2017			December 31, 2016
Derivatives designated as cash flow hedges
Interest rate	$	—	$	49	$	—		$	—
Foreign currency	545		109		—			(536		)
Fair value	$	545	$	158	$	—		$	(536	)
Derivatives not designated as cash flow hedges
Foreign currency	$	4,782	$	1,070	$	(1,459	)	$	(3,698	)
Fair value	$	4,782	$	1,070	$	(1,459	)	$	(3,698	)
Total fair value	$	5,327	$	1,228	$	(1,459	)	$	(4,234	)

Schedule Of Derivative Assets And Liabilities On Gross And Net Settlement Basis Table

The following table presents our derivative assets and liabilities at June 30, 2017 on a gross basis and a net settlement basis:

	Gross Amounts Recognized (i)			Gross Amounts Offset on the Balance Sheet (ii)		Net Amounts Presented on the Balance Sheet (iii) = (i) - (ii)			Gross Amounts Not Offset on the Balance Sheet (iv)					Net Amount (v) = (iii) - (iv)
									Financial Instruments			Cash Collateral Received
Derivative Assets
Foreign currency	5,327			—		5,327			(179		)	—		5,148
Total assets	$	5,327		$	—	$	5,327		$	(179	)	$	—	$	5,148
Derivative Liabilities
Foreign currency	(1,459		)	—		(1,459		)	179			—		(1,280		)
Total liabilities	$	(1,459	)	$	—	$	(1,459	)	$	179		$	—	$	(1,280	)

Total Value, by Underlying Risk, Recognized in Other Comprehensive Income and Reclassified from Accumulated Other Comprehensive Income to Interest Expense and Cost of Revenue

The following table presents the total value, by underlying risk, recognized in other comprehensive income (“OCI”) and reclassified from AOCI to interest expense (interest rate derivatives) and cost of revenue (foreign currency derivatives) during the three and six months ended June 30, 2017 and 2016 for derivatives designated as cash flow hedges:

	Amount of Gain (Loss) on Effective Derivative Portion
	Recognized in OCI										Reclassified from AOCI into Earnings (1)
	Three Months Ended June 30,					Six Months Ended June 30,					Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017		2016			2017		2016			2017		2016
Derivatives designated as cash flow hedges
Interest rate	$	—	$	(248	)	$	—	$	(961	)	$	—	$	(163	)	$	49	$	(344	)
Foreign currency	497		(655		)	1,179		821			84		148			208		(914		)
Total	$	497	$	(903	)	$	1,179	$	(140	)	$	84	$	(15	)	$	257	$	(1,258	)

⁽¹⁾  Net unrealized gains totaling approximately $600 are anticipated to be reclassified from AOCI into earnings during the next 12 months due to settlement of the associated underlying obligations.

Total Value Recognized in Cost of Revenue for Derivatives which Do Not Seek Hedge Accounting Treatment, by Underlying Risk

The following table presents the total value recognized in cost of revenue for the three and six months ended June 30, 2017 and 2016 for foreign currency derivatives not designated as cash flow hedges:

	Amount of Gain (Loss) Recognized in Earnings
	Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017			2016
Derivatives not designated as cash flow hedges
Foreign currency	$	5,774	$	(4,930	)	$	(396	)	$	(9,159	)
Total	$	5,774	$	(4,930	)	$	(396	)	$	(9,159	)

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RETIREMENT BENEFITS (Tables)

6 Months Ended

Jun. 30, 2017

Compensation and Retirement Disclosure [Abstract]

Contribution Information for Defined Benefit and Other Postretirement Plans

The following table provides updated contribution information for these plans at June 30, 2017:

	Pension Plans		Other Postretirement Plans
Contributions made through June 30, 2017	$	9,720	$	1,040
Contributions expected for the remainder of 2017	8,183		1,238
Total contributions expected for 2017	$	17,903	$	2,278

Components of Net Periodic Benefit Cost

The following table provides a breakout of the components of net periodic benefit cost (income) associated with our defined benefit pension and other postretirement plans for the three and six months ended June 30, 2017 and 2016:

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Pension Plans
Service cost	$	2,871		$	2,384		$	5,653		$	4,711
Interest cost	4,737			5,975			9,328			11,893
Expected return on plan assets	(5,968		)	(6,821		)	(11,754		)	(13,617		)
Amortization of prior service credits	(156		)	(158		)	(306		)	(312		)
Recognized net actuarial losses	1,529			1,475			3,027			2,936
Settlement expense (1)	2,426			—			2,426			—
Net periodic benefit cost	$	5,439		$	2,855		$	8,374		$	5,611
Other Postretirement Plans
Service cost	$	171		$	176		$	342		$	352
Interest cost	342			341			684			681
Recognized net actuarial gains	(685		)	(841		)	(1,370		)	(1,681		)
Net periodic benefit income	$	(172	)	$	(324	)	$	(344	)	$	(648	)

⁽¹⁾  Net periodic benefit cost in 2017 was impacted by the settlement of our qualified Canadian pension plan in the second quarter 2017. The settlement resulted in the immediate recognition of previously unrecognized actuarial gains related to the plan that were previously included in AOCI.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables)

6 Months Ended

Jun. 30, 2017

Equity [Abstract]

Changes in AOCI Balances by Component

The following table presents changes in AOCI, net of tax, by component, during the six months ended June 30, 2017:

	Currency Translation Adjustment (1)			Unrealized Fair Value Of Cash Flow Hedges			Defined Benefit Pension and Other Postretirement Plans			Total
Balance at December 31, 2016	$	(264,562	)	$	(213	)	$	(130,841	)	$	(395,616	)
OCI before reclassifications	55,973			942			(10,924		)	45,991
Amounts reclassified from AOCI	—			(132		)	2,859			2,727
Net OCI	55,973			810			(8,065		)	48,718
Balance at June 30, 2017	$	(208,589	)	$	597		$	(138,906	)	$	(346,898	)

⁽¹⁾  During the six months ended June 30, 2017, the currency translation adjustment component of AOCI was favorably impacted by net movements in the Australian Dollar, British Pound, and Euro exchange rates against the U.S. Dollar.

Significant Items Reclassified From AOCI Into Earnings

The following table presents reclassification of AOCI into earnings, net of tax, for each component, during the six months ended June 30, 2017:

	Amount Reclassified From AOCI
Unrealized Fair Value Of Cash Flow Hedges (1)
Interest rate derivatives (interest expense)	$	(49	)
Foreign currency derivatives (cost of revenue)	(208		)
Total before tax	$	(257	)
Tax	125
Total net of tax	$	(132	)
Defined Benefit Pension and Other Postretirement Plans (2)
Amortization of prior service credits	$	(306	)
Recognized net actuarial losses	4,155
Total before tax	$	3,849
Tax	(990		)
Total net of tax	$	2,859

⁽¹⁾  See Note 9 for further discussion of our cash flow hedges, including the total value reclassified from AOCI to earnings.

⁽²⁾  See Note 10 for further discussion of our defined benefit and other postretirement plans, including the components of net periodic benefit cost.

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EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY (Tables)

6 Months Ended

Jun. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Granted Shares Associated with Equity-Based Incentive Plans

During the six months ended June 30, 2017, we had the following share grants associated with our Incentive Plans:

	Shares (1)	Weighted Average Grant-Date Fair Value per Share
RSUs	1,155	$	32.13
Financial performance based shares	597	$	36.00
Stock performance based shares	149	$	44.21
Total shares granted	1,901

⁽¹⁾  No stock options were granted during the six months ended June 30, 2017.

Stock-Based Incentive Plans and Employee Stock Purchase Plan

During the six months ended June 30, 2017, we had the following share issuances associated with our Incentive Plans and employee stock purchase plan (“ESPP”):

	Shares
Financial performance based shares (issued upon vesting)	49
RSUs (issued upon vesting)	867
Stock options (issued upon exercise)	32
ESPP shares (issued upon sale)	239
Total shares issued	1,187

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SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

Total Revenue, Income, and Assets from Operations by Reportable Segments

The following table presents total revenue and income from operations by reportable segment for the three and six months ended June 30, 2017 and 2016:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
Revenue
Engineering & Construction	$	702,150		$	1,548,994	$	1,982,903		$	3,085,355
Fabrication Services	508,518			547,658		987,090			1,081,364
Technology	72,809			64,512		140,836			129,074
Total revenue	$	1,283,477		$	2,161,164	$	3,110,829		$	4,295,793
Operating (Loss) Income From Continuing Operations
Engineering & Construction	$	(525,682	)	$	92,809	$	(520,268	)	$	200,882
Fabrication Services	57,639			67,385		109,698			104,495
Technology	21,460			23,054		42,975			49,203
Total operating (loss) income from continuing operations	$	(446,583	)	$	183,248	$	(367,595	)	$	354,580

The following table presents total assets by reportable segment at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Assets
Engineering & Construction	$	3,694,396	$	3,572,399
Fabrication Services	2,465,398		2,394,041
Technology	986,485		996,104
Total assets of continuing operations	7,146,279		6,962,544
Assets of discontinued operations (Note 4)	—		876,876
Total assets	$	7,146,279	$	7,839,420

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ORGANIZATION AND NATURE OF OPERATIONS (Details)	6 Months Ended
	Jun. 30, 2017 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Year founded	1889
Number of operating segments	3

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SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Significant Accounting Policies [Line Items]
Contract receivable retainage, after next twelve months	$ 46,600	$ 37,500
Minimum [Member]
Significant Accounting Policies [Line Items]
Finite-lived identifiable intangible assets, estimated useful lives, (in years)	6 years
Maximum [Member]
Significant Accounting Policies [Line Items]
Finite-lived identifiable intangible assets, estimated useful lives, (in years)	20 years
Accounts Receivable [Member]
Significant Accounting Policies [Line Items]
Contract retentions	$ 64,500	72,100
Costs and Estimated Earnings in Excess of Billings [Member]
Significant Accounting Policies [Line Items]
Unbilled receivables of service contracts	9,600	$ 16,100
Other Operating Income (Expense) [Member]
Significant Accounting Policies [Line Items]
Other Operating Income (Expense), Net	$ 3,000

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SIGNIFICANT ACCOUNTING POLICIES - Contracts In Progress Table (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Contracts In Progress [Line Items]
Contracts in Progress, net, assets	$ 418,038	$ 410,749
Contracts in Progress, net, liability	(1,704,464)	(1,395,349)
Assets [Member]
Contracts In Progress [Line Items]
Costs and estimated earnings on contracts in progress	4,334,524	8,466,638
Billings on contracts in progress	(3,916,486)	(8,055,889)
Liability [Member]
Contracts In Progress [Line Items]
Costs and estimated earnings on contracts in progress	28,697,752	23,408,316
Billings on contracts in progress	(30,402,216)	(24,803,665)
Costs and Estimated Earnings in Excess of Billings [Member]
Contracts In Progress [Line Items]
Contracts in Progress, net, assets	418,038	410,749
Billings in Excess of Costs and Estimated Earnings [Member]
Contracts In Progress [Line Items]
Contracts in Progress, net, liability	$ (1,704,464)	$ (1,395,349)

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EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Earnings Per Share [Abstract]
Net (loss) income from continuing operations attributable to CB&I (net of $2,452, $8,272, $29,289 and $20,861 of noncontrolling interests)		$ (304,115)	$ 115,597	$ (288,541)	$ 216,931
Net (loss) income from discontinued operations attributable to CB&I (net of $457, $437, $870 and $885 of noncontrolling interests)		(121,304)	8,242	(112,223)	13,833
Net (loss) income attributable to CB&I		$ (425,419)	$ 123,839	$ (400,764)	$ 230,764
Weighted average shares outstanding—basic		100,866	105,298	100,660	105,051
Effect of restricted shares/performance based shares/stock options (in shares)	[1]	0	780	0	861
Effect of directors' deferred-fee shares (in shares)	[1]	0	13	0	13
Weighted average shares outstanding—diluted (in shares)		100,866	106,091	100,660	105,925
Net (loss) income attributable to CB&I per share (Basic):
(Loss) income from continuing operations, per basic share		$ (3.02)	$ 1.10	$ (2.87)	$ 2.07
(Loss) income from discontinued operations and disposal of discontinued operations, net of tax, per basic share		(1.20)	0.08	(1.11)	0.13
Basic (in dollars per share)		(4.22)	1.18	(3.98)	2.20
Net (loss) income attributable to CB&I per share (Diluted):
(Loss) income from discontinued operations and disposal of discontinued operations, net of tax, per diluted share		(1.20)	0.08	(1.11)	0.13
(Loss) income from continuing operations, per diluted share		(3.02)	1.09	(2.87)	2.05
Diluted (in dollars per share)		$ (4.22)	$ 1.17	$ (3.98)	$ 2.18
(Loss) income from continuing operations, net of noncontrolling interests		$ 2,452	$ 8,272	$ 29,289	$ 20,861
Net income (loss) related to discontinued operations		$ 457	$ 437	$ 870	$ 885

[1] The effect of restricted shares, performance based shares, stock options and directors’ deferred-fee shares were not included in the calculation of diluted EPS for the three and six months ended June 30, 2017 due to the net loss for the periods. Antidilutive shares excluded from diluted EPS were not material for the three and six months ended June 30, 2016.

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DISPOSITION OF CAPITAL SERVICES OPERATIONS - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Initial Consideration	$ 755,000			$ 755,000
Disposal group, including discontinued operation, consideration	700,000			700,000
Disposal Group Including Discontinued Operation Working Capital Adjustments And Other Adjustments	32,600			32,600
Proceeds from Divestiture of Businesses				667,400
Proceeds from sale of discontinued operation, net of cash sold				645,506	$ 0
Proceeds From Divestiture Of Businesses, Net Of Transaction Costs				599,000
Disposal Group Including Discontinued Operations Transaction Costs	46,500			46,500
Loss on net assets sold	64,817		$ 0	64,817	$ 0
Income tax expense	$ 61,000			$ 61,000
Capital Services [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Goodwill impairment		$ 655,000

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DISPOSITON OF CAPITAL SERVICES OPERATIONS - Assets and Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Disposal Group, Including Discontinued Operation, Assets, Current [Abstract]
Cash	$ 0	$ 14,477	$ 16,596
Accounts receivable, net		239,146
Costs and estimated earnings in excess of billings		153,275
Other assets		7,834
Current assets of discontinued operations	0	414,732
Disposal Group, Including Discontinued Operation, Assets, Noncurrent [Abstract]
Property and equipment, net		59,746
Goodwill		229,607
Other intangibles, net		148,440
Other assets		24,351
Non-current assets of discontinued operations	0	462,144
Total assets of discontinued operations		876,876
Disposal Group, Including Discontinued Operation, Liabilities, Current [Abstract]
Accounts payable		141,028
Billings in excess of costs and estimated earnings		53,986
Other liabilities		52,455
Current liabilities of discontinued operations	0	247,469
Disposal Group, Including Discontinued Operation, Liabilities, Noncurrent [Abstract]
Other liabilities		5,388
Non-current liabilities of discontinued operations	0	5,388
Total liabilities of discontinued operations		252,857
Noncontrolling interests of discontinued operations	0	6,874
Discontinued Operations, Held-for-sale [Member]
Disposal Group, Including Discontinued Operation, Assets, Noncurrent [Abstract]
Total assets of discontinued operations	$ 0	$ 876,876

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DISPOSITION OF CAPITAL SERVICES OPERATIONS - Operating Results (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Discontinued Operations and Disposal Groups [Abstract]
Revenue	$ 561,708	$ 559,690	$ 1,114,655	$ 1,124,671
Cost of revenue	528,927	523,119	1,047,614	1,056,065
Gross profit	32,781	36,571	67,041	68,606
Selling and administrative expense	16,503	13,536	29,541	25,187
Intangibles amortization	0	4,030	2,550	8,230
Loss on net assets sold	64,817	0	64,817	0
Other operating expense (income)	876	120	504	(304)
Operating (loss) income from discontinued operations	(49,415)	18,885	(30,371)	35,493
Interest expense	(6,577)	(5,877)	(13,440)	(11,710)
Interest income	7	305	16	614
(Loss) income from discontinued operations before taxes	(55,985)	13,313	(43,795)	24,397
Income tax expense	(64,862)	(4,634)	(67,558)	(9,679)
Net (loss) income from discontinued operations	(120,847)	8,679	(111,353)	14,718
Net income from discontinued operations attributable to noncontrolling interests	(457)	(437)	(870)	(885)
Income (Loss) from Discontinued Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest [Abstract]
Net (loss) income from discontinued operations attributable to CB&I	$ (121,304)	$ 8,242	$ (112,223)	$ 13,833

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DISPOSITION OF CAPITAL SERVICES OPERATIONS - Cash Flows (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Discontinued Operations and Disposal Groups [Abstract]
Operating cash flows	$ (36,469)	$ 28,470
Investing cash flows	$ (1,459)	$ (2,495)

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INVENTORY (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Inventory Disclosure [Abstract]
Raw materials	$ 97,231	$ 65,969
Work in process	28,717	51,625
Finished goods	32,870	72,508
Total	$ 158,818	$ 190,102

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GOODWILL AND OTHER INTANGIBLES - Additional Information (Details)	3 Months Ended	12 Months Ended
	Dec. 31, 2016 USD ($)	Dec. 31, 2016 USD ($) reporting_unit	Jun. 30, 2017 USD ($)	[1]
Goodwill [Line Items]
Goodwill	$ 2,813,803,000	$ 2,813,803,000	$ 2,829,214,000
Number of reporting units | reporting_unit		3
All Other [Member]
Goodwill [Line Items]
Goodwill impairment	$ 0

[1] At June 30, 2017, we had approximately $453,100 of cumulative impairment losses which were recorded in our Engineering & Construction operating group during 2015 related to the sale of our nuclear power construction business (our “Nuclear Operations”) on December 31, 2015.

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GOODWILL AND OTHER INTANGIBLES - Change in Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($)
Goodwill [Roll Forward]
Balance at beginning of period	$ 2,813,803
Foreign currency translation and other	16,596
Amortization of tax goodwill in excess of book goodwill	(1,185)
Balance at end of period	2,829,214	[1]
Engineering and Construction [Member]
Goodwill [Roll Forward]
Goodwill, impaired, accumulated impairment loss	$ 453,100

[1] At June 30, 2017, we had approximately $453,100 of cumulative impairment losses which were recorded in our Engineering & Construction operating group during 2015 related to the sale of our nuclear power construction business (our “Nuclear Operations”) on December 31, 2015.

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GOODWILL AND OTHER INTANGIBLES - Acquired Finite-Lived Intangible Asset Balances Including Weighted-Average Useful Lives (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Weighted Average Life	[1]			16 years
Gross Carrying Amount	[1]	$ 389,456		$ 389,456		$ 384,692
Accumulated Amortization	[1]	(181,068)		(181,068)		(165,283)
Amortization expense		6,377	$ 6,464	$ 12,863	$ 13,541
Backlog and customer relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Life				18 years
Gross Carrying Amount		99,086		$ 99,086		99,086
Accumulated Amortization		(24,143)		$ (24,143)		(21,374)
Process technologies [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Life				15 years
Gross Carrying Amount		263,043		$ 263,043		258,516
Accumulated Amortization		(140,717)		$ (140,717)		(129,261)
Tradenames [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Life				12 years
Gross Carrying Amount		27,327		$ 27,327		27,090
Accumulated Amortization		$ (16,208)		$ (16,208)		$ (14,648)

[1] The decrease in other intangibles, net during the six months ended June 30, 2017 primarily related to amortization expense of approximately $12,900.

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PARTNERING ARRANGEMENTS - Additional Information (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($) Train	Dec. 31, 2016 USD ($)
Schedule of Investments [Line Items]
Advances to ventures	$ 347,300	$ 394,400
CB&I [Member] | Chevron-Lummus Global CLG [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	50.00%
CB&I [Member] | Net Power [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	33.30%
Cash commitment	$ 47,300
Equity method invested	$ 44,900
CB&I [Member] | CTCI Corporation [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	50.00%
Chevron [Member] | Chevron-Lummus Global CLG [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	50.00%
Exelon [Member] | Net Power [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	33.30%
8 Rivers Capital [Member] | Net Power [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	33.30%
CTCI Corporation [Member]
Schedule of Investments [Line Items]
Equity method investment percentage	50.00%
CB&I/Zachary [Member]
Schedule of Investments [Line Items]
Number of LNG trains | Train	2
Joint venture contract value	$ 2,700,000
CB&I/Zachary [Member] | Zachry [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	50.00%
CB&I/Zachary [Member] | CB&I [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	50.00%
CB&I/Zachry/Chiyoda [Member]
Schedule of Investments [Line Items]
Joint venture contract value	$ 675,000
CB&I/Zachry/Chiyoda [Member] | Zachry [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	33.30%
CB&I/Zachry/Chiyoda [Member] | Chiyoda [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	33.30%
CB&I/Zachry/Chiyoda [Member] | CB&I [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	33.30%
CB&I/Chiyoda [Member]
Schedule of Investments [Line Items]
Number of LNG trains | Train	3
Joint venture contract value	$ 3,200,000
CB&I/Chiyoda [Member] | Chiyoda [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	50.00%
CB&I/Chiyoda [Member] | CB&I [Member]
Schedule of Investments [Line Items]
Proportionately consolidated ventures percentage	50.00%
Chicago Bridge and Iron and CTCI Joint Venture [Member]
Schedule of Investments [Line Items]
Joint venture contract value	$ 1,400,000
Advances to ventures	$ 205,900	$ 147,000
CB&I/Kentz [Member]
Schedule of Investments [Line Items]
Number of LNG trains | Train	3
Joint venture contract value	$ 5,900,000
CB&I/Kentz [Member] | Kentz [Member]
Schedule of Investments [Line Items]
Percentage of ownership in consolidated venture	35.00%
CB&I/Kentz [Member] | CB&I [Member]
Schedule of Investments [Line Items]
Percentage of ownership in consolidated venture	65.00%
CB&I/Areva [Member]
Schedule of Investments [Line Items]
Joint venture contract value	$ 5,800,000
CB&I/Areva [Member] | Areva [Member]
Schedule of Investments [Line Items]
Percentage of ownership in consolidated venture	48.00%
CB&I/Areva [Member] | CB&I [Member]
Schedule of Investments [Line Items]
Percentage of ownership in consolidated venture	52.00%

XML

PARTNERING ARRANGEMENTS - Proportionately Consolidated Variable Interest Entities Summarized Balance Sheet Information (Details) - USD ($) $ in Thousands		Jun. 30, 2017	Dec. 31, 2016
Schedule of Equity Method Investments [Line Items]
Advances from ventures		$ 324,400	$ 374,800
Advances to ventures		347,300	394,400
CB&I/Zachary [Member]
Schedule of Equity Method Investments [Line Items]
Variable interest entity proportionately consolidated carrying amount current assets	[1]	251,237	260,934
Non-current assets		2,678	3,204
Current assets		253,915	264,138
Current liabilities	[1]	387,466	379,339
CB&I/Zachry/Chiyoda [Member]
Schedule of Equity Method Investments [Line Items]
Variable interest entity proportionately consolidated carrying amount current assets	[1]	88,593	84,279
Non-current assets		1,539	1,969
Current assets		90,132	86,248
Current liabilities	[1]	68,305	73,138
CB&I/Chiyoda [Member]
Schedule of Equity Method Investments [Line Items]
Current assets	[1]	186,278	337,479
Current liabilities	[1]	$ 258,367	$ 150,179

[1] Our venture arrangements allow for excess working capital of the ventures to be advanced to the venture partners. Such advances are returned to the ventures for working capital needs as necessary. Accordingly, at a reporting period end a venture may have advances to its partners which are reflected as an advance receivable within current assets of the venture. At June 30, 2017 and December 31, 2016, other current assets on the Balance Sheet included approximately $324,400 and $374,800, respectively, related to our proportionate share of advances from the ventures to our venture partners, and other current liabilities included approximately $347,300 and $394,400, respectively, related to advances to CB&I from the ventures.

XML

PARTNERING ARRANGEMENTS - Summarized Balance Sheet Information of Variable Interest Entities (Details) - USD ($) $ in Thousands		Jun. 30, 2017	Dec. 31, 2016
CB&I/Kentz [Member]
Variable Interest Entity [Line Items]
Current assets		$ 26,486	$ 68,867
Non-current assets	[1]	69,404	0
Total assets	[1]	95,890	68,867
Current liabilities		27,581	87,822
CB&I/AREVA [Member]
Variable Interest Entity [Line Items]
Current assets		24,416	16,313
Current liabilities		50,086	47,652
All Other [Member]
Variable Interest Entity [Line Items]
Current assets	[1]	33,099	69,785
Non-current assets	[1]	16,003	16,382
Total assets	[1]	49,102	86,167
Current liabilities	[1]	$ 8,514	$ 7,748

[1] Other ventures that we consolidate are not individually material to our financial results and are therefore aggregated as “All Other”.

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DEBT - Additional Information (Details)										3 Months Ended		6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Sep. 30, 2017 USD ($)	Aug. 09, 2017 Rate	Jul. 28, 2017 USD ($)	Feb. 24, 2017 USD ($)	Feb. 13, 2017 USD ($)	Mar. 31, 2018 USD ($)	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017 USD ($) Rate	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)
Debt Disclosure [Line Items]
Total letter of credit sublimit													$ 100,000,000
Revolving facility and other short-term borrowings													$ 374,000,000				$ 407,500,000
Debt instrument, covenant, leverage ratio post amendment													5.25
Bank covenant, minimum net worth requirement post amendment								$ 1,201,507,000
Debt instrument, covenant, senior secured leverage ratio											4.00		4.50
Debt instrument, covenant, leverage ratio consecutive													3.00
Current maturities of long-term debt, net													$ 1,469,320,000				503,910,000
Long-term Debt													$ 1,200,000,000
Revolving Credit Facility One [Member]
Debt Disclosure [Line Items]
Debt instrument, term													5 years
Line of credit facility, maximum borrowing capacity													$ 1,150,000,000
Financial letters line of credit capacity													230,000,000
Total letter of credit sublimit													100,000,000
Revolving facility and other short-term borrowings													204,000,000
Amount outstanding under credit facility													67,211,000
Financial letters of credit, outstanding amount													0
Letters of credit, remaining capacity													32,789,000
Remaining borrowing capacity under credit facility													$ 878,789,000
Weighted average interest rate													3.30%
Revolving Credit Facility Two [Member]
Debt Disclosure [Line Items]
Debt instrument, term													5 years
Line of credit facility, maximum borrowing capacity													$ 800,000,000
Financial letters line of credit capacity													50,000,000
Total letter of credit sublimit													100,000,000
Revolving facility and other short-term borrowings													170,000,000
Amount outstanding under credit facility													72,445,000
Financial letters of credit, outstanding amount													2,757,000
Letters of credit, remaining capacity													27,555,000
Remaining borrowing capacity under credit facility													$ 557,555,000
Weighted average interest rate													4.90%
Uncommitted Credit Facility [Member]
Debt Disclosure [Line Items]
Amount outstanding under credit facility													$ 1,624,089,000
Total Revolving Credit Facilities Member
Debt Disclosure [Line Items]
Aggregate revolving debt capacity													70.00%
Maximum outstanding borrowings													$ 1,700,000,000
First Senior Notes [Member]
Debt Disclosure [Line Items]
Senior notes													800,000,000				800,000,000
Series A Senior Notes [Member]
Debt Disclosure [Line Items]
Senior notes													$ 150,000,000
Semi annually fixed rate payable													4.65%
Month and year senior note matures													2017-12
Series B Senior Notes [Member]
Debt Disclosure [Line Items]
Senior notes													$ 225,000,000
Semi annually fixed rate payable													5.07%
Month and year senior note matures													2019-12
Series C Senior Notes [Member]
Debt Disclosure [Line Items]
Senior notes													$ 275,000,000
Semi annually fixed rate payable													5.65%
Month and year senior note matures													2022-12
Series D Senior Notes [Member]
Debt Disclosure [Line Items]
Senior notes													$ 150,000,000
Semi annually fixed rate payable													5.80%
Month and year senior note matures													2024-12
Second Senior Notes [Member]
Debt Disclosure [Line Items]
Senior notes													$ 200,000,000				200,000,000
Semi annually fixed rate payable													5.03%
First And Second Senior Notes [Member]
Debt Disclosure [Line Items]
Semi annually fixed rate payable													2.50%
Incremental annual cost based on credit profile													1.50%
Surety Bond [Member]
Debt Disclosure [Line Items]
Outstanding surety bonds													$ 358,739,000
Term Loan Two [Member]
Debt Disclosure [Line Items]
Debt instrument, term													5 years
Weighted average interest rate													3.10%
Long-term debt, maturities, repayments of principal, remainder of fiscal year													$ 37,500,000
Debt instrument, face amount													500,000,000				500,000,000
Long-term debt, gross													481,250,000
Future annual maturities for 2018													75,000,000
Future annual maturities for 2019													75,000,000
Future annual maturities for 2020													$ 293,750,000
Term Loan One [Member]
Debt Disclosure [Line Items]
Debt instrument, term									4 years
Weighted average interest rate											2.60%
Long-term debt, maturities, repayments of principal, remainder of fiscal year									$ 300,000,000
Debt instrument, face amount									$ 1,000,000,000
Prime Rate [Member]
Debt Disclosure [Line Items]
Debt instrument, basis for variable rate													4.25%
Debt instrument, basis spread on variable rate													1.50%
London Interbank Offered Rate (LIBOR) [Member]
Debt Disclosure [Line Items]
Debt instrument, basis for variable rate									0.98%				1.23%
Debt instrument, basis spread on variable rate									2.25%				2.50%
Maximum [Member]
Debt Disclosure [Line Items]
Debt instrument, covenant leverage ratio													1.75
Items included in consolidated statement of financial condition													$ 3,000,000,000
Maximum [Member] | First And Second Senior Notes [Member]
Debt Disclosure [Line Items]
Incremental annual cost based on leverage													1.00%
Incremental annual cost based on credit profile and everage | Rate													2.00%
Minimum [Member]
Debt Disclosure [Line Items]
Debt instrument, covenant fixed charge coverage ratio													2.25
Minimum [Member] | First And Second Senior Notes [Member]
Debt Disclosure [Line Items]
Incremental annual cost based on leverage													0.50%
Unsecured Revolving Credit Facility [Member] | Revolving Credit Facility One [Member]
Debt Disclosure [Line Items]
Line of credit facility, maximum borrowing capacity																	$ 1,350,000,000
Line of credit facility, expiration date													2018-10
Unsecured Revolving Credit Facility [Member] | Revolving Credit Facility Two [Member]
Debt Disclosure [Line Items]
Line of credit facility, expiration date													2018-02
Unsecured Revolving Credit Facility [Member] | Maximum [Member] | Revolving Credit Facility One [Member]
Debt Disclosure [Line Items]
Debt instrument, covenant, leverage ratio post amendment								3.5					3.00
Unsecured Revolving Credit Facility [Member] | Minimum [Member] | Revolving Credit Facility One [Member]
Debt Disclosure [Line Items]
Debt instrument, covenant fixed charge coverage ratio								1.75
Term Loan [Member] | Term Loan Two [Member]
Debt Disclosure [Line Items]
Debt instrument, face amount													$ 500,000,000
Term Loan [Member] | Term Loan One [Member]
Debt Disclosure [Line Items]
Debt instrument, face amount													1,000,000,000
Scenario, Forecast [Member]
Debt Disclosure [Line Items]
Financial letters of credit fee percentage | Rate						5.00%
Performance letter of credit fee percentage | Rate						3.50%
Debt instrument, covenant, leverage ratio post amendment										4.00		3.25		3.00	6.00	4.00
Debt instrument, covenant, senior secured leverage ratio										3.00		2.50			4.50	3.00
Scenario, Forecast [Member] | First Senior Notes [Member]
Debt Disclosure [Line Items]
Repayments of debt							$ 211,800,000
Scenario, Forecast [Member] | Series A Senior Notes [Member]
Debt Disclosure [Line Items]
Repayments of debt							44,600,000
Scenario, Forecast [Member] | Series B Senior Notes [Member]
Debt Disclosure [Line Items]
Repayments of debt							58,200,000
Scenario, Forecast [Member] | Series C Senior Notes [Member]
Debt Disclosure [Line Items]
Repayments of debt							78,500,000
Scenario, Forecast [Member] | Series D Senior Notes [Member]
Debt Disclosure [Line Items]
Repayments of debt							30,500,000
Scenario, Forecast [Member] | Second Senior Notes [Member]
Debt Disclosure [Line Items]
Repayments of debt							$ 57,100,000
Scenario, Forecast [Member] | Prime Rate [Member]
Debt Disclosure [Line Items]
Debt instrument, basis spread on variable rate						4.00%
Scenario, Forecast [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Disclosure [Line Items]
Debt instrument, basis spread on variable rate						5.00%
Scenario, Forecast [Member] | Maximum [Member]
Debt Disclosure [Line Items]
Items included in consolidated statement of financial condition			$ 2,900,000,000							$ 2,900,000,000
Scenario, Forecast [Member] | Minimum [Member]
Debt Disclosure [Line Items]
Trailing twelve month EBITDA	$ 425,000,000	$ 450,000,000	500,000,000	$ 550,000,000	$ 500,000,000
Scenario, Forecast [Member] | Minimum [Member] | Total Revolving Credit Facilities Member
Debt Disclosure [Line Items]
Remaining borrowing capacity under credit facility			$ 250,000,000	$ 150,000,000						$ 250,000,000						$ 150,000,000
Discontinued Operations, Held-for-sale [Member]
Debt Disclosure [Line Items]
Backlog													166,000,000
Discontinued Operations, Held-for-sale [Member] | Surety Bond [Member]
Debt Disclosure [Line Items]
Outstanding surety bonds													$ 473,194,000

XML

DEBT - Outstanding Debt (Details) - USD ($)	6 Months Ended
	Jun. 30, 2017	Feb. 13, 2017	Dec. 31, 2016
Current
Revolving facility and other short-term borrowings	$ 374,000,000		$ 407,500,000
Current maturities of long-term debt	1,481,250,000		506,250,000
Less: unamortized debt issuance costs	(11,930,000)		(2,340,000)
Current maturities of long-term debt, net of unamortized debt issuance costs	1,469,320,000		503,910,000
Current debt, net of unamortized debt issuance costs	1,843,320,000		911,410,000
Long-Term
Less: unamortized debt issuance costs	0		(5,827,000)
Current maturities of long-term debt	(1,481,250,000)		(506,250,000)
Long-term debt, net	$ 0		1,287,923,000
Minimum [Member]
Long-Term
Senior notes fixed interest rate	4.65%
Maximum [Member]
Long-Term
Senior notes fixed interest rate	5.80%
First Senior Notes [Member]
Long-Term
Senior notes	$ 800,000,000		800,000,000
Second Senior Notes [Member]
Long-Term
Senior notes	$ 200,000,000		200,000,000
Long-term debt, fixed interest rate	5.03%
Term Loan Two [Member]
Long-Term
Long-term debt, gross	$ 481,250,000
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)	500,000,000		500,000,000
Term Loan Two [Member] | Term Loan [Member]
Long-Term
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)	$ 500,000,000
Debt instrument, interest rate terms	Interest at LIBOR plus an applicable floating margin
Term Loan One [Member]
Long-Term
Term Loan: $1,000,000 term loan (interest at LIBOR plus a floating margin)	$ 0		$ 300,000,000
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)		$ 1,000,000,000
Term Loan One [Member] | Term Loan [Member]
Long-Term
Second Term Loan: $500,000 term loan (interest at LIBOR plus a floating margin)	$ 1,000,000,000
Debt instrument, interest rate terms	Interest at LIBOR plus an applicable floating margin

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FINANCIAL INSTRUMENTS - Additional Information (Details) - USD ($)	6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
First Senior Notes [Member]
Derivative [Line Items]
Senior notes	$ 800,000,000	$ 800,000,000
First Senior Notes [Member] | Level 2 [Member]
Derivative [Line Items]
Senior notes		785,700,000
Second Senior Notes [Member]
Derivative [Line Items]
Senior notes	200,000,000	200,000,000
Second Senior Notes [Member] | Level 2 [Member]
Derivative [Line Items]
Senior notes		$ 206,400,000
Foreign Exchange Contract Operating Exposure [Member]
Derivative [Line Items]
Notional value of outstanding forward contracts	$ 139,600,000
Foreign Exchange Contract Operating Exposure [Member] | Maximum [Member]
Derivative [Line Items]
Maturity of foreign currency derivatives from period-end	5 years

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FINANCIAL INSTRUMENTS - Carried at Fair Value (Details) - USD ($) $ in Thousands		Jun. 30, 2017	Dec. 31, 2016
Derivatives:
Other current assets	[1]	$ 4,766	$ 1,146
Other non-current assets	[1]	561	82
Total assets at fair value	[1]	5,327	1,228
Derivatives:
Other current liabilities		(551)	(3,509)
Other non-current liabilities		(908)	(725)
Total liabilities at fair value		(1,459)	(4,234)
Level 1 [Member]
Derivatives:
Other current assets	[1]	0	0
Other non-current assets	[1]	0	0
Total assets at fair value	[1]	0	0
Derivatives:
Other current liabilities		0	0
Other non-current liabilities		0	0
Total liabilities at fair value		0	0
Level 2 [Member]
Derivatives:
Other current assets	[1]	4,766	1,146
Other non-current assets	[1]	561	82
Total assets at fair value	[1]	5,327	1,228
Derivatives:
Other current liabilities		(551)	(3,509)
Other non-current liabilities		(908)	(725)
Total liabilities at fair value		(1,459)	(4,234)
Level 3 [Member]
Derivatives:
Other current assets	[1]	0	0
Other non-current assets	[1]	0	0
Total assets at fair value	[1]	0	0
Derivatives:
Other current liabilities		0	0
Other non-current liabilities		0	0
Total liabilities at fair value		$ 0	$ 0

[1] We are exposed to credit risk on our hedging instruments associated with potential counterparty non-performance, and the fair value of our derivatives reflects this credit risk. The total level 2 assets at fair value above represent the maximum loss that we would incur on our outstanding hedges if the applicable counterparties failed to perform according to the hedge contracts. To help mitigate counterparty credit risk, we transact only with counterparties that are rated as investment grade or higher and monitor all counterparties on a continuous basis.

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FINANCIAL INSTRUMENTS - Total Fair Value by Underlying Risk and Balance Sheet Classification (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	$ 5,327	$ 1,228
Liability derivatives fair value	(1,459)	(4,234)
Foreign currency [Member]
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	5,327
Liability derivatives fair value	(1,459)
Derivatives designated as cash flow hedges [Member]
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	545	158
Liability derivatives fair value	0	(536)
Derivatives designated as cash flow hedges [Member] | Interest rate [Member] | Other Current and Non-Current Assets [Member]
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	0	49
Derivatives designated as cash flow hedges [Member] | Interest rate [Member] | Other Current and Non-Current Liabilities [Member]
Derivatives, Fair Value [Line Items]
Liability derivatives fair value	0	0
Derivatives designated as cash flow hedges [Member] | Foreign currency [Member] | Other Current and Non-Current Assets [Member]
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	545	109
Derivatives designated as cash flow hedges [Member] | Foreign currency [Member] | Other Current and Non-Current Liabilities [Member]
Derivatives, Fair Value [Line Items]
Liability derivatives fair value	0	(536)
Derivatives not designated as cash flow hedges [Member]
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	4,782	1,070
Liability derivatives fair value	(1,459)	(3,698)
Derivatives not designated as cash flow hedges [Member] | Foreign currency [Member] | Other Current and Non-Current Assets [Member]
Derivatives, Fair Value [Line Items]
Asset derivatives fair value	4,782	1,070
Derivatives not designated as cash flow hedges [Member] | Foreign currency [Member] | Other Current and Non-Current Liabilities [Member]
Derivatives, Fair Value [Line Items]
Liability derivatives fair value	$ (1,459)	$ (3,698)

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FINANCIAL INSTRUMENTS - Derivative Assets and Liabilities on Gross Basis and Net Settlement Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Assets:
Gross amounts recognized	$ 5,327	$ 1,228
Gross amounts offset on the balance sheet	0
Net amounts presented on the balance sheet	5,327
Gross amounts not offset on the balance sheet - financial instruments	(179)
Gross amounts not offset on the balance sheet - cash collateral received	0
Net amount	5,148
Liabilities:
Gross amounts recognized	(1,459)	$ (4,234)
Gross amounts offset on the balance sheet	0
Net amounts presented on the balance sheet	(1,459)
Gross amounts not offset on the balance sheet - financial instruments	179
Gross amounts not offset on the balance sheet - cash collateral received	0
Net amount	(1,280)
Foreign currency [Member]
Assets:
Gross amounts recognized	5,327
Gross amounts offset on the balance sheet	0
Net amounts presented on the balance sheet	5,327
Gross amounts not offset on the balance sheet - financial instruments	(179)
Gross amounts not offset on the balance sheet - cash collateral received	0
Net amount	5,148
Liabilities:
Gross amounts recognized	(1,459)
Gross amounts offset on the balance sheet	0
Net amounts presented on the balance sheet	(1,459)
Gross amounts not offset on the balance sheet - financial instruments	179
Gross amounts not offset on the balance sheet - cash collateral received	0
Net amount	$ (1,280)

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FINANCIAL INSTRUMENTS - Total Value, by Underlying Risk, Recognized in Other Comprehensive Income and Reclassified from Accumulated Other Comprehensive Income to Interest Expense and Cost of Revenue (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings		$ (422,510)	$ 132,548	$ (370,605)	$ 252,510
Derivatives designated as cash flow hedges [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion recognized in OCI		497	(903)
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings	[1]	84	(15)
Net unrealized gains anticipated to be reclassified into earnings during the next 12 months				600
Derivatives designated as cash flow hedges [Member] | Interest rate [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion recognized in OCI		0	(248)
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings	[1]	0	(163)
Derivatives designated as cash flow hedges [Member] | Foreign currency [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion recognized in OCI		497	(655)
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings	[1]	$ 84	$ 148
Cash Flow Hedging [Member] | Derivatives designated as cash flow hedges [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion recognized in OCI				1,179	(140)
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings				257	(1,258)
Cash Flow Hedging [Member] | Derivatives designated as cash flow hedges [Member] | Interest rate [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion recognized in OCI				0	(961)
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings				49	(344)
Cash Flow Hedging [Member] | Derivatives designated as cash flow hedges [Member] | Foreign currency [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) on effective derivative portion recognized in OCI				1,179	821
Amount of gain (loss) on effective derivative portion reclassified from AOCI into earnings				$ 208	$ (914)

[1] Net unrealized gains totaling approximately $600 are anticipated to be reclassified from AOCI into earnings during the next 12 months due to settlement of the associated underlying obligations.

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FINANCIAL INSTRUMENTS - Total Value Recognized in Cost of Revenue for Foreign Currency Derivatives not Designated As Cash Flow Hedges (Details) - Derivatives not designated as cash flow hedges [Member] - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in Earnings	$ 5,774	$ (4,930)	$ (396)	$ (9,159)
Foreign currency [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in Earnings	$ 5,774	$ (4,930)	$ (396)	$ (9,159)

XML

RETIREMENT BENEFITS - Additional Information (Details) $ in Millions	6 Months Ended
	Jun. 30, 2017 USD ($)
Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions expected for 2017 fiscal year	$ 17.0
Other Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions expected for 2017 fiscal year	$ 2.5

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RETIREMENT BENEFITS - Contribution Information for Defined Benefit and Other Postretirement Plans (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($)
Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions made through June 30, 2017	$ 9,720
Contributions expected for the remainder of 2017	8,183
Total contributions expected for 2017	17,903
Other Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions made through June 30, 2017	1,040
Contributions expected for the remainder of 2017	1,238
Total contributions expected for 2017	$ 2,278

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RETIREMENT BENEFITS - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 2,871	$ 2,384	$ 5,653	$ 4,711
Interest cost	4,737	5,975	9,328	11,893
Expected return on plan assets	(5,968)	(6,821)	(11,754)	(13,617)
Amortization of prior service credits	(156)	(158)	(306)	(312)
Recognized net actuarial losses (gains)	1,529	1,475	3,027	2,936
Defined Benefit Plan, Recognized Net Gain (Loss) Due to Settlements	2,426	0	2,426	0
Net periodic benefit cost (income)	5,439	2,855	8,374	5,611
Other Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	171	176	342	352
Interest cost	342	341	684	681
Recognized net actuarial losses (gains)	(685)	(841)	(1,370)	(1,681)
Net periodic benefit cost (income)	$ (172)	$ (324)	$ (344)	$ (648)

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COMMITMENTS AND CONTINGENCIES (Details)	6 Months Ended
	Jun. 30, 2017 USD ($) Plaintiff claim legal_matter	Apr. 28, 2016 USD ($)
Commitments and Contingencies Disclosure [Line Items]
Contract receivables	$ 236,000,000
Liability for asbestos and environmental claims, gross	$ 8,300,000
Asbestos Litigation [Member]
Commitments and Contingencies Disclosure [Line Items]
Number of plaintiffs | Plaintiff	6,100
Number of plaintiffs whose claims pending | claim	1,200
Number of plaintiffs whose claims closed through dismissals or settlements | legal_matter	4,900
Settlement amount per claim (dollars per legal matter)	$ 2,000
WEC [Member]
Commitments and Contingencies Disclosure [Line Items]
Closing working capital		$ (976,506,000)
Target working capital		2,150,506,000
CB&I [Member]
Commitments and Contingencies Disclosure [Line Items]
Closing working capital		1,601,805,000
Target working capital		$ 427,805,000

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ACCUMULATED OTHER COMPREHENSIVE INCOME - Components and Reclassification of Accumulated Other Comprehensive (Loss) Income, Net of Tax (Details) - USD ($) $ in Thousands		6 Months Ended
		Jun. 30, 2017	Jun. 30, 2016
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance		$ 1,561,337	$ 2,163,590
Ending Balance		1,220,210	2,389,963
Currency Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance	[1]	(264,562)
OCI before reclassifications	[1]	55,973
Amounts reclassified from AOCI	[1]	0
Net OCI	[1]	55,973
Ending Balance	[1]	(208,589)
Unrealized Fair Value Of Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance		(213)
OCI before reclassifications		942
Amounts reclassified from AOCI		(132)
Net OCI		810
Ending Balance		597
Defined Benefit Pension and Other Postretirement Plans [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance		(130,841)
OCI before reclassifications		(10,924)
Amounts reclassified from AOCI		2,859
Net OCI		(8,065)
Ending Balance		(138,906)
Accumulated Other Comprehensive (Loss) Income [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance		(395,616)	(294,040)
OCI before reclassifications		45,991
Amounts reclassified from AOCI		2,727
Net OCI		48,718
Ending Balance		$ (346,898)	$ (292,250)

[1] During the six months ended June 30, 2017, the currency translation adjustment component of AOCI was favorably impacted by net movements in the Australian Dollar, British Pound, and Euro exchange rates against the U.S. Dollar.

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ACCUMULATED OTHER COMPREHENSIVE INCOME - Significant Items Reclassified Into Earnings (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($)
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Interest rate derivatives (interest expense) and Foreign currency derivatives (cost of revenue)	$ (257)	[1]
Tax	125	[1]
Total net of tax	(132)	[1]
Amortization of prior service credits	(306)	[2]
Recognized net actuarial losses	4,155	[2]
Total before tax	3,849	[2]
Tax	(990)	[2]
Total net of tax	2,859	[2]
Interest rate derivatives (interest expense) [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Interest rate derivatives (interest expense) and Foreign currency derivatives (cost of revenue)	(49)	[1]
Foreign currency derivatives (cost of revenue) [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Interest rate derivatives (interest expense) and Foreign currency derivatives (cost of revenue)	$ (208)	[1]

[1] See Note 9 for further discussion of our cash flow hedges, including the total value reclassified from AOCI to earnings.

[2] See Note 10 for further discussion of our defined benefit and other postretirement plans, including the components of net periodic benefit cost.

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EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY - Stock Plans - Additional Information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Purchase of treasury stock			$ 9,080	$ 7,970
Treasury Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Purchase of treasury stock (in shares)			299	237
Purchase of treasury stock			$ 9,080	$ 7,970
Share repurchase, average price per share (in dollars per share)	$ 30.37		$ 30.37
Continuing Operations [Member] | Selling and administrative expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 16,194	$ 6,658	$ 26,441	21,158
Discontinued Operations, Held-for-sale [Member] | Selling and administrative expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 6,198	$ 718	$ 6,874	$ 1,640

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EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY - Granted Shares Associated with Equity-Based Incentive Plans (Details)	6 Months Ended
	Jun. 30, 2017 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares	1,901,000	[1]
Number of stock options granted	0
RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares	1,155,000	[1]
Weighted-average grant-date fair value (in dollars per share) | $ / shares	$ 32.13
Performance shares [Member] | Financial Performance-Based Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares	597,000	[1]
Weighted-average grant-date fair value (in dollars per share) | $ / shares	$ 36.00
Performance shares [Member] | Stock Performance-Based Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares	149,000	[1]
Weighted-average grant-date fair value (in dollars per share) | $ / shares	$ 44.21

[1] No stock options were granted during the six months ended June 30, 2017.

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EQUITY-BASED INCENTIVE PLANS AND OTHER EQUITY ACTIVITY - Stock-Based Incentive Plans and Employee Stock Purchase Plan (Details) shares in Thousands	6 Months Ended
	Jun. 30, 2017 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares	1,187
Financial performance based shares (issued upon vesting)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares	49
RSUs (issued upon vesting)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares	867
Stock options (issued upon exercise)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares	32
ESPP shares (issued upon sale)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares	239

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UNAPPROVED CHANGE ORDERS, CLAIMS, INCENTIVES AND OTHER PROJECT MATTERS (Details) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2017 USD ($) Projects	Jun. 30, 2017 USD ($) Projects	Dec. 31, 2016 USD ($)
Schedule Of Unapproved Claims And Change Orders [Line Items]
Contracts Receivable, Claims and Uncertain Amounts, Expected to be Collected after Next Twelve Months	$ 39,000	$ 39,000
Account receivable and unbilled receivable	$ 31,000	$ 31,000
Number of projects, estimated net margin, decrease to operating income | Projects	4	4
Estimated net margin, decrease to operating income	$ 548,000	$ 715,000
Number of projects, estimated net margin, increase to operating income | Projects	2	2
Estimated net margin, increase to operating income		$ 103,000
Number of projects, estimated net margin, decrease to operating income, loss position projects | Projects	2	2
Unapproved change orders cumulative payment from customer	$ 154,000	$ 154,000
Number of projects | Projects	1	1
Estimated net margin, decrease to operating income, loss position projects	$ 181,000	$ 324,000
Percent of project completed	86.00%	86.00%
Reserve for estimated project losses	$ 23,000	$ 23,000
All Other [Member]
Schedule Of Unapproved Claims And Change Orders [Line Items]
Unapproved change orders, amount	520,000	520,000	$ 121,100
Revenues recognized on a cumulative POC basis	$ 456,000	$ 456,000
Percent of project completed	69.00%	69.00%
Reserve for estimated project losses	$ 98,000	$ 98,000
Engineering and Construction, Fabrication Services [Member]
Schedule Of Unapproved Claims And Change Orders [Line Items]
Incentive amounts included in contract price	38,200	38,200	$ 43,000
Revenues recognized on a cumulative POC basis	21,300	21,300
Unapproved change orders and claims are subject to arbitration proceedings or early commercial discussions [Member]
Schedule Of Unapproved Claims And Change Orders [Line Items]
Contracts Receivable, Claims and Uncertain Amounts	$ 266,200	$ 266,200
Proportionately Consolidated Ventures [Member]
Schedule Of Unapproved Claims And Change Orders [Line Items]
Number of projects, estimated net margin, decrease to operating income, loss position projects | Projects	2	2
Estimated net margin, decrease to operating income, loss position projects	$ 367,000	$ 391,000
Proportionately Consolidated Ventures [Member] | All Other [Member]
Schedule Of Unapproved Claims And Change Orders [Line Items]
Number of projects, estimated net margin, decrease to operating income, loss position projects | Projects	1	1

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SEGMENT INFORMATION - Additional Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) segment	Jun. 30, 2016 USD ($)
Segment Reporting Information [Line Items]
Number of business sectors | segment			3
Revenue	$ 1,283,477	$ 2,161,164	$ 3,110,829	$ 4,295,793
Intersegment Eliminations [Member]
Segment Reporting Information [Line Items]
Revenue	152,700	66,700	294,100	107,600
Discontinued Operations, Held-for-sale [Member] | Intersegment Eliminations [Member]
Segment Reporting Information [Line Items]
Revenue	$ 18,500	$ 25,200	$ 34,400	$ 57,100

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SEGMENT INFORMATION - Total Revenue and Income from Operations by Reporting Segment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Segment Reporting Information [Line Items]
Revenue	$ 1,283,477	$ 2,161,164	$ 3,110,829	$ 4,295,793
Operating (Loss) Income From Continuing Operations	(446,583)	183,248	(367,595)	354,580
Assets of discontinued operations (Note 4)					$ 876,876
Operating Segments [Member] | Engineering and Construction [Member]
Segment Reporting Information [Line Items]
Revenue	702,150	1,548,994	1,982,903	3,085,355
Operating (Loss) Income From Continuing Operations	(525,682)	92,809	(520,268)	200,882
Operating Segments [Member] | Fabrication Services [Member]
Segment Reporting Information [Line Items]
Revenue	508,518	547,658	987,090	1,081,364
Operating (Loss) Income From Continuing Operations	57,639	67,385	109,698	104,495
Operating Segments [Member] | Technology [Member]
Segment Reporting Information [Line Items]
Revenue	72,809	64,512	140,836	129,074
Operating (Loss) Income From Continuing Operations	21,460	$ 23,054	42,975	$ 49,203
Discontinued Operations, Held-for-sale [Member]
Segment Reporting Information [Line Items]
Assets of discontinued operations (Note 4)	$ 0		$ 0		$ 876,876

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SEGMENT INFORMATION - Total Assets by Reportable Segment (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Assets	$ 7,146,279	$ 7,839,420
Assets of discontinued operations (Note 4)		876,876
Operating Segments [Member] | Engineering and Construction [Member]
Segment Reporting Information [Line Items]
Assets	3,694,396	3,572,399
Operating Segments [Member] | Fabrication Services [Member]
Segment Reporting Information [Line Items]
Assets	2,465,398	2,394,041
Operating Segments [Member] | Technology [Member]
Segment Reporting Information [Line Items]
Assets	986,485	996,104
Continuing Operations [Member]
Segment Reporting Information [Line Items]
Assets	7,146,279	6,962,544
Discontinued Operations, Held-for-sale [Member]
Segment Reporting Information [Line Items]
Assets of discontinued operations (Note 4)	$ 0	$ 876,876