Hurricane Katrina Could Impact Fluor, Taco Bell, PacSun

Orange County Business Journal, Sep 5-Sep 11, 2005 by Maio, Pat

It was too early to assess the ripple effects of Hurricane Katrina's destruction late last week. But several Orange County companies could see fallout from the storm that ripped through New Orleans and other cities along the Gulf Coast, shuttering oil and gas operations and killing scores of residents.

Clothing makers Pacific Sunwear of California Inc. of Anaheim and Wet Seal Inc. of Foothill Ranch each have two stores within 11 miles of New Orleans.

A phone call to the Wet Seal store at the Espanade Mall in Kenner, La., just outside New Orleans, wasn't answered. But the clerk at a Baton Rouge, La.-based PacSun store 60 miles to the northwest of New Orleans said it was open.

"We were closed Monday, but now we're really busy," said the clerk, who declined to be identified.

Irvine-based Taco Bell Corp., a Mexican fast food chain, has 20 restaurants within 10 miles of New Orleans and five within 10 miles of Biloxi, Miss.

It's not clear how many of the Taco Bells are franchises or company-owned restaurants.

"We still are in the process of assessing all of our restaurants and where everyone is. There are no deaths reported yet," said spokeswoman Laurie Schalow. "Some restaurants have water damage and others are a writeoff."

Santa Ana-based Corinthian Colleges Inc. operates a Bryman College campus in New Orleans. Corinthian put a message on its Web site asking for information on its students and teachers.

The government sales team at Santa Ana-based computer products distributor Ingram Micro Inc. said it has identified key Federal Emergency Management Agency resellers to help customers affected by the hurricane get priority service.

Perhaps most impacted by the hurricane could be Aliso Viejo-based engineering services provider Fluor Corp.

Fluor has done work for decades in the Gulf Coast region where the hurricane wreaked havoc among the oil industry's refineries and offshore oil drilling platforms.

"At this point, we've not been asked to do anything," said Jerry Holloway, a Fluor spokesman. "We are early in terms of damage assessment."

A big reason for Fluor's planned headquarters move to Texas next year is so that it would be closer to its bread and butter energy business. Fluor reported total U.S. backlog for oil and gas work of $5.4 billion at the end of 2004.

The company also has a Greenville, S.C., office where it plans to work with the Federal Emergency Management Agency to help assess damage on the region's oil and gas facilities.

Oil refineries were among the hardest hit along the Gulf. The American Petroleum Institute said last week that the hurricane shuttered eight oil refineries, and forced a dozen others to reduce operations.

Fluor's Holloway declined to identify the company's possible involvement in any of those refineries.

Shares of Fluor jumped last week on the possibility of winning rebuilding contracts. But one analyst, Stewart Scharf of Standard & Poor's, said in a report that the stock increase was "a knee-jerk reaction."

In OC, the gas price spikes have impacted numerous businesses, including Anaheim's Ganahl Lumber Co.

Ganahl has upped delivery fees by 11 % to $50 per delivery load because of rising fuel costs. Similar fuel surcharges were imposed by Santa Ana-based GeoLogistics Corp., a transportation company that ships consumer products using global air carriers and ocean shipping lines, and Schick Moving & Storage in Tustin.

Brian Womack contributed to this story.