J.M. Bernhard, Jr.

In just 14 short years, J.M. Bernhard, Jr., Chairman, President, and C.E.O. of The Shaw Group, has grown his business into the world's only vertically-integrated provider of complete piping systems and comprehensive engineering, procurement and construction services to the power generation industry. The year 2000 proved to be a period of dynamic change, significant growth and rewarding performance for Shaw. The company doubled its size, increased its backlog to over $2 billion and watched its stock price appreciate by more than an impressive 300%.

Beyond a well-developed strategy, two significant developments occurred this year that directly point to a profitable future for the Company. First EntergyShaw L.L.C., a jointly-owned and operated company, was formed to provide management, engineering, procurement, construction and commissioning services for the building of power generation plants for Entergy Corporation's wholesale operations in North America and Europe. Second, the acquisition of most of the operating assets of Stone & Webster, a premier name in the engineering and construction world with over a hundred years serving the power generation industry. This strategic acquisition strengthened Shaw's presence in the power industry, complemented and enhanced its traditional strengths in pipe fabrication and project execution and enables the Company to provide a more complete, cost effective package of products and services for its power and process customers.

"With this combination [Shaw and Stone & Webster], we believe that Shaw will be a leader in setting a new paradigm in an industry that has warranted change," stated Bernhard. "Stone & Webster has a recognized name in the industry, and its premier engineering capabilities complement our strategy and strength in the power market, particularly our announced joint venture with Entergy."

Only weeks before entering into the bidding arena for assets of Stone & Webster, a letter of intent was signed between Shaw and Entergy Corporation to form the above referenced venture, EntergyShaw. At the time, EntergyShaw was slated to manage the installation of over 30 turbines that Entergy had contracted for delivery with General Electric (GE). On the heels of Shaw closing the Stone & Webster acquisition, Entergy announced a proposed merger with FPL Group, which combined with Entergy's unregulated business, would increase the total number of turbines to be installed by EntergyShaw to over 70 turbines.

"What was already a great combination of capabilities and resources was even further enhanced by Entergy's proposed merger with FPL Group and our acquisition of the assets of Stone & Webster." Bernhard said. "We planned to build our management and other personnel throughout the year in anticipation of the workload resulting from EntergyShaw, but the Stone & Webster transaction placed us ahead of the game, especially when Entergy announced its proposed merger with FPL Group."

Whether gas-fired, coal-fired or nuclear generated facilities - Shaw boasts an impressive portfolio of experience in the power industry that dates back over a century. Bernhard says as long as demand for electricity exists, his company will participate in a major way.

"Our strategy for growth is sound. It is flexible. It allows the Company to respond nimbly to market conditions. It grants us the freedom to make timely acquisitions and form mutually beneficial alliances. It positions us to take advantage of opportunties as they arise. And it has allowed us to extend our horizons without diluting the core competencies that make up the foundation for the Shaw Group.

"Through our adherence to this strategy, we have evolved our company into a global enterprise positioned to benefit from the build-up of activity in the power generation industry--strengthened by our proprietary technologies and expertise in the other industries we serve.

"We look forward to a future of exceptional performance and reward for our global family of employees, customers, partners and shareholders," Bernhard told World Cogeneration for the Class of 2001.