================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from _____________ to _____________
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
CHICAGO BRIDGE & IRON SAVINGS PLAN
c/o Chicago Bridge & Iron Company
14105 S. Route 59
Plainfield, Illinois 60544
B. Name and issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Chicago Bridge & Iron Company, N.V.
Polarisavenue 31
2132 JH Hoofdorp
The Netherlands
================================================================================
CHICAGO BRIDGE & IRON SAVINGS PLAN
TABLE OF CONTENTS
-------------------------------------------------------------------------------------------
PAGE
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits as of
December 31, 2003 and 2002 2
Statement of Changes in Net Assets Available for Benefits for the
Year Ended December 31, 2003 3
Notes to Financial Statements 4-8
SUPPLEMENTAL SCHEDULES:
Form 5500, Schedule H, Part IV, Line 4i--
Schedule of Assets (Held at End of Year), as of December 31, 2003 9
SIGNATURES 10
(Supplemental schedules not listed are omitted due to the absence of conditions
under which they are required.)
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Plan Administrator of the
Chicago Bridge & Iron Savings Plan:
We have audited the accompanying statements of net assets available for benefits
of the Chicago Bridge & Iron Savings Plan (the "Plan") as of December 31, 2003
and 2002, and the related statement of changes in net assets available for
benefits for the year ended December 31, 2003. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States) and in accordance with generally
accepted auditing standards as established by the Auditing Standards Board
(United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2003 and 2002, and the changes in net assets available for benefits for the year
then ended December 31, 2003 in conformity with accounting principles generally
accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule, listed on the
Table of Contents, is presented for the purpose of additional analysis and is
not a required part of the basic financial statements, but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This schedule is the responsibility of the Plan's management. This
schedule has been subjected to the auditing procedures applied in our audit of
the basic 2003 financial statements and, in our opinion, are fairly stated in
all material respects when considered in relation to the basic financial
statements taken as a whole.
DELOITTE & TOUCHE LLP
Houston, Texas
June 25, 2004
CHICAGO BRIDGE & IRON SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2003 AND 2002
-----------------------------------------------------------------------------
2003 2002
------------- ------------
ASSETS
CASH AND CASH EQUIVALENTS $ 7,130 $ -
INVESTMENTS 271,044,572 208,644,557
EMPLOYER CONTRIBUTION RECEIVABLE 9,293,923 9,043,241
------------- ------------
NET ASSETS AVAILABLE FOR BENEFITS $280,345,625 $217,687,798
============ ============
See notes to financial statements.
-2-
CHICAGO BRIDGE & IRON SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 2003
--------------------------------------------------------------------------------
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Interest $ 335,810
Dividends 4,160,791
Net appreciation in fair value of investments 45,946,452
Plan transfers in 31,055
Contributions:
Employer 13,245,900
Participant 12,521,381
Rollovers 1,002,892
Other 6,687
------------
Total additions 77,250,968
------------
DEDUCTIONS TO NET ASSETS ATTRIBUTED TO:
Benefits paid to participants 14,579,304
Administrative expenses 13,837
------------
Total deductions 14,593,141
------------
NET INCREASE 62,657,827
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 217,687,798
------------
End of year $280,345,625
============
See notes to financial statements.
-3-
CHICAGO BRIDGE & IRON SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 2003 AND 2002
-------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN AND INVESTMENT PROGRAM
The following describes the major provisions of the Chicago Bridge & Iron
Savings Plan (the "Plan") and provides only general information.
Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
GENERAL--The Plan is a defined contribution plan in which designated
employees of Chicago Bridge & Iron Company and certain of its wholly owned
subsidiaries (the "Company") are eligible to participate. The Plan is
subject to the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA").
T. Rowe Price Trust Company (the "Trustee") serves as trustee. The record
keeper for the Plan, under a contract with the Company, is T. Rowe Price
Retirement Plan Services, Inc. ("RPS").
MERGERS INTO PLAN--Effective January 1, 2002, the Morse Construction Group
division of the Rock-Mo 401(k) Plan merged into this plan. Participant
account balances of $629,122 were transferred to the Plan during 2002.
Effective October 3, 2002, the CB&I Shop Employees 401(k) Plan merged into
this Plan. Participant account balances of $4,209,491 were transferred to
the Plan during 2002.
Effective December 31, 2000, the Howe-Baker Engineers, Inc. Employees'
Profit-Sharing 401(k) Plan, Matrix Engineering, Inc. Savings Plan, A&B
Buildings, Inc. Savings Plan and Callidus Technologies 401(k) Savings Plan
("Merged Plans"), merged into this Plan.
PARTICIPANT AND COMPANY CONTRIBUTIONS--The Plan is a combination
profit-sharing and 401(k) voluntary salary deferral plan. Except as noted
below, the Company automatically contributes 5% of annual pay (including
overtime and incentive compensation) and may contribute up to 12%
depending on Company performance and IRS limits on compensation. The
Company contribution is applicable for each eligible participant following
the end of the Plan year for which the contribution is made. Participants
may contribute amounts on a pretax deferred basis from a minimum of 1% to
a maximum of 75% of compensation subject to the dollar limits set by the
IRS, or lower percentage limits set by the Company in advance of a given
Plan year. Participants may elect to change their contribution percentages
at any time in advance of the next payroll period.
The Company contributes a dollar-for-dollar match of the participants'
annual 401(k) contributions, up to the first 3% of the compensation that
the participant elects to contribute.
For purposes of contributions, the following applies for participants
covered by the merged plans:
o For participants who formerly participated in the Howe-Baker
Engineers, Inc. Employees' Profit-Sharing 401(k) Plan, the Company
contributes 1% of compensation. Additionally the Company makes
matching contributions of 50% of the first 4% of compensation, and
may make additional discretionary contributions. A discretionary
contribution of $1,685,368 was made for the Plan year ended December
31, 2003.
-4-
o For participants who formerly participated in the Matrix
Engineering, Inc. Savings Plan or the A&B Builders, Inc. Savings
Plan, the Company makes matching contributions of 50% of the first
6% of compensation, and may make discretionary contributions as
determined each year. There were no discretionary contributions
during the year.
o For participants who formerly participated in the Callidus
Technologies 401(k) Savings Plan, the Company automatically
contributes 3% of annual pay (including overtime and incentive
compensation) and may contribute up to 6% depending on Company
performance and IRS limits on compensation; makes matching
contributions of 100% of the first 3% of compensation; and may make
discretionary Company contributions as determined each year. A
discretionary contribution of $284,027 was made for the Plan year
ended December 31, 2003.
o For participants who formerly participated in the CB&I Shop
Employees 401(k) Plan, which merged with the Plan during 2002, the
Company made matching contributions of 100% up to $0.60 per hour for
total hours worked for Clive and Warren, with matching contributions
ceasing for Warren employees on November 3, 2002. The Company made
matching contributions of $0.70 per hour up to October 31, 2002 and
$0.75 per hour beginning November 1, 2002 for total hours worked for
Provo employees.
o For participants employed by Morse Construction Group who formerly
participated in the Rock-Mo 401(k) Plan, the Company makes matching
contributions of 100% of the first 3% of compensation; and may make
discretionary Company contributions as determined each year. No
discretionary contribution was made for the Plan year ended December
31, 2003.
PARTICIPANT ACCOUNTS--Individual accounts are maintained for each Plan
participant. Each participant's account is credited with the participant's
contribution, Company contributions, and allocation of investment earnings
or losses. Allocations are based on account balances. The benefit to which
a participant is entitled is the benefit that can be provided from the
participant's vested account.
INVESTMENT OPTIONS--Participants direct the investment of their account
balances into any or all of a number of investment options which include
mutual funds investing in equities (including the Trade Link investment
account investing in mutual funds beyond the Trustee's family of funds) a
company stock fund (which invests in the common stock of Chicago Bridge &
Iron Company, N.V.), an income fund investing in bonds, a stable value
fund, and a money market fund.
The Plan's investments in the common stock of Placer Dome, Inc. and
Mississippi Chemical Corp. result from prior plan mergers and no future
investment is permitted in those investments.
VESTING--Company matching contributions vest 100% after three years and
the Company's annual contributions vest 100% after five years of service
with the Company. Participants who terminate their participation in the
Plan due to retirement, disability, death or work force reduction are
granted full vesting in Company contributions.
For participants formerly included in the CB&I Shop Employee 401(k) Plan,
Company matching contributions prior to 2002 vest over a five-year
cliff-vesting schedule. Company contributions made in 2002 and 2003 vest
over a three-year cliff-vesting schedule.
PARTICIPANT LOANS--Participants may borrow up to 50% of their vested
account balances, up to $50,000, with a minimum loan amount of $1,000. No
more than one loan may be outstanding from a participant's account at any
time. Loans are secured by the balance in the participant's account, bear
interest at the prime rate plus 1% and are repayable over a period not to
exceed five years, except for
-5-
principal residence loans, which are repayable over a period not to exceed
fifteen years. Any amount borrowed is deducted pro rata from the funds in
which the participant account is invested. Repayments of principal and
interest are credited to the funds in which the participant's deferrals
are invested.
PAYMENT OF BENEFITS--Upon termination of employment, participants may
receive a lump-sum payment of their account balances, subject to the
vesting provisions described above. Other payment forms are available to
certain participants for accounts existing prior to January 1, 1997.
FORFEITURES--Forfeited accounts, representing the unvested portion of the
Company's contributions, were approximately $477,000 and $353,000 as of
December 31, 2003 and 2002, respectively. These balances will be used to
reduce future Company contributions. Amounts used in 2003 and 2002,
respectively, to offset employer contributions totaled $377,413 and
$420,000.
2. SUMMARY OF ACCOUNTING POLICIES
BASIS OF ACCOUNTING--The accompanying financial statements of the Plan
were prepared on the accrual basis of accounting in accordance with
accounting principles generally accepted in the United States of America
("GAAP").
USE OF ESTIMATES--The preparation of financial statements in conformity
with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, and changes
therein, and disclosure of contingent assets and liabilities. Actual
results could differ from those estimates. The Plan utilizes various
investment instruments. Investment securities, in general, are exposed to
various risks, such as interest rate, credit, and overall market
volatility. Due to the level of risk associated with certain investment
securities, it is reasonably possible that changes in the values of
investment securities will occur in the near term and that such changes
could materially affect the amounts reported in the financial statements.
INVESTMENT VALUATION AND INCOME RECOGNITION--The Plan's investments are
stated at fair value as determined by quoted market prices, except for
investments in the Stable Value Fund, which is stated at contract value
(which includes accrued interest). Participant loans are valued at cost,
which approximates fair value. The net appreciation (depreciation) in fair
value of investment securities consists of the net changes in unrealized
appreciation (depreciation) in fair value and realized gains (losses) upon
the sale of investments. The net change in unrealized appreciation
(depreciation) is determined using the fair values as of the beginning of
the year or the purchase price if acquired since that time. Realized gains
(losses) upon sale are calculated using a first-in, first-out basis.
The T. Rowe Price Stable Value Fund is a common and collective trust
("CCT"). The Plan owns shares in this CCT, which, in turn, holds shares in
the underlying securities, which includes guaranteed investment contracts.
The fund provides for benefit-responsive withdrawals at contract value.
The average yield for the CCT was approximately 4.27% for the year ended
December 31, 2003. The crediting interest rate for the CCT was
approximately 4.03% and 4.85% at December 31, 2003 and 2002, respectively.
Purchases and sales of securities are recorded on a trade date basis.
Interest income is recorded on an accrual basis. Dividend income is
recorded on the ex-dividend date.
ADMINISTRATIVE EXPENSES--Trustee fees are paid by the Plan. Investment
management fees, agent fees and brokerage commissions are paid by the Plan
and are included as a reduction of the return earned on each fund. Other
outside professional, administrative services are paid or provided by the
Company.
-6-
PAYMENT OF BENEFITS--Benefit payments to participants are recorded upon
distribution. There were no amounts allocated to accounts of persons who
have elected to withdraw from the plan but have not yet been paid at
December 31, 2003 and 2002.
3. INVESTMENTS
The following presents investments that represent 5% or more of the Plan's
net assets at December 31, 2003 and 2002:
2003 2002
----------- -----------
T. Rowe Price Blue Chip Growth Fund $41,729,139 $30,718,954
T. Rowe Price Balanced Fund $38,906,883 $31,902,989
T. Rowe Price Equity Income Fund $34,994,791 $26,613,969
T. Rowe Price Summit Cash Reserves Fund $27,358,708 $29,210,480
T. Rowe Price Equity Index Trust $23,411,360 $17,134,072
T. Rowe Price Stable Value Fund $23,263,563 $21,240,522
T. Rowe Price New Horizons Fund $19,372,406 $11,374,919
T. Rowe Price Spectrum Income Fund $15,929,405 $10,838,463
During 2003, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated
in value by $45,946,452 as follows:
Mutual funds: $42,215,621
Common stock 3,730,831
-----------
Total $45,946,452
===========
4. RELATED-PARTY TRANSACTIONS
All of the investment fund options are managed by T. Rowe Price
Associates, Inc. ("Associates") an affiliate of the Trustee, except for
the Stable Value Fund and Equity Index Trust Fund. The Stable Value Fund
(CCT) and the Equity Index Trust Fund are managed by the Trustee.
At December 31, 2003 and 2002, the Plan held 269,930.1412 and 127,900.120
units (or shares), of Chicago Bridge & Iron Company, N.V. ("CB&I N.V."),
the Plan's sponsor, with a fair value of $7,800,981 and $3,862,584,
respectively. During the year ended December 31, 2003, the Plan recorded
dividend income from the CB&I N.V. stock of $42,545.
5. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of
Plan termination, participants will become 100% vested in their accounts
regardless of the period of service.
-7-
6. TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter, dated May 21, 2002, that the Plan and related trust are designed
in accordance with applicable sections of the Internal Revenue Code (the
"Code"). The plan administrator and the Plan's tax counsel believe that
the Plan is currently designed and being operated in compliance with the
applicable requirements of the Code. Accordingly, no provision for income
taxes has been included in the Plan's financial statements.
******
-8-
SCHEDULE I
CHICAGO BRIDGE & IRON SAVINGS PLAN
FORM 5500, SCHEDULE H, LINE 4i--
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2003
(EMPLOYER IDENTIFICATION NUMBER 06-1477022, PLAN NUMBER 001)
------------------------------------------------------------------------------
(A) (B) IDENTITY OF ISSUER, BORROWER, (C) DESCRIPTION OF INVESTMENT (D) (E) CURRENT
LESSOR OR SIMILAR PARTY ** VALUE
Mutual funds:
* T. Rowe Price Spectrum Income Fund $ 15,929,405
* T. Rowe Price Balanced Fund 38,906,883
* T. Rowe Price Blue Chip Growth Fund 41,729,139
* T. Rowe Price Equity Income Fund 34,994,791
* T. Rowe Price Equity Index Trust 23,411,360
* T. Rowe Price Summit Cash Reserves Fund 27,358,708
* T. Rowe Price Spectrum Growth Fund 6,528,337
* T. Rowe Price New Horizons Fund 19,372,406
* T. Rowe Price Janus Fund 4,558,339
* T. Rowe Price Small Cap Value Fund 12,634,858
* T. Rowe Price Stable Value Fund 23,263,563
* T. Rowe Price American Europacific Growth Fund 8,849,136
* T. Rowe Price Trade Link Investments Account 271,690
Placer Dome Inc. Common stock 89,882
Mississippi Chemical Corp. Common stock 150
* Chicago Bridge & Iron Company N. V. Common stock 7,800,981
* Participant loans Interest rates--5.00% to 10.5%,
maturing 2004 to 2018 5,344,944
-------------
TOTAL $ 271,044,572
* Represents a party-in-interest to the Plan.
** Cost information is omitted with respect to participant directed accounts.
-9-
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the plan
administrator has duly caused this annual report to be signed on its behalf by
the undersigned thereunto duly authorized.
Dated: June 25, 2004
CHICAGO BRIDGE & IRON SAVINGS PLAN
By: /s/ DAVID P. BORDAGES
-------------------------------------
David P. Bordages
Vice-President, Human Resources
and Administration
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
------- -----------
23 Report of Independent Registered Public Accounting Firm