the Middle East (approximately $140.0 million), and CB&I Steel Plate Structures design and construction of storage tanks and associated works for a refinery expansion in Australia (approximately $130.0 million).
Backlog at March 31, 2009 was $4.9 billion compared with $5.7 billion at December 31, 2008.
Revenue-Revenue of $1.3 billion during the three months ended March 31, 2009 decreased $143.5 million, or 10%, compared with the corresponding 2008 period. Revenue decreased $30.9 million (7%), for CB&I Steel Plate Structures, $95.8 million (11%), for CB&I Lummus and $16.9 million (17%), for Lummus Technology. The following factors contributed to the decrease in our revenue in the current year period relative to the comparable prior year period:
• CB&I Steel Plate Structures - The current year period was impacted by the wind down of two large projects in Australia, which was partly offset by greater volume in the Middle East.

• CB&I Lummus - The current year period was impacted by a lower volume of LNG terminal work in the U.S. and United Kingdom ("U.K."), offset partially by higher revenue for refinery work in Europe and South America.

• Lummus Technology - The current year period was impacted by fewer licensing contract awards, partly offset by higher catalyst sales.

Gross Profit-Gross profit in the first quarter of 2009 was $144.2 million (11.1% of revenue), compared with gross profit of $126.0 million (8.8% of revenue), for the corresponding period in 2008. The difference in gross profit as a percentage of revenue in the current year period versus the comparable prior year period is primarily due to the following factors:
• CB&I Steel Plate Structures -The prior year period benefited from lower pre-contract costs and realized higher margins due to project mix, principally in the Middle East.

• CB&I Lummus - The prior year period included the recognition of a significant volume of revenue on projects for which low profit margins were recognized or material charges to earnings were recorded. Included in the 2008 period was a $19.1 million charge for a project in the United States and $20.7 million for our South Hook and Isle of Grain II LNG projects in the U.K.

During the 2009 period, we recognized similar charges in the U.K. of $20.5 million to capture additional projected costs to complete our South Hook LNG project, however our remaining backlog realized margin levels above those in 2008 due to solid project execution and project mix.

During the first quarter 2009, the South Hook LNG terminal received its first shipment of LNG. Our work on the balance of the project is on-going and completion is expected in late 2009. If weather factors, labor productivity and subcontractor performance on the project were to decline from amounts utilized in our current estimates, our schedule for project completion, and our future results of operations, would be negatively impacted.

Equity Earnings-Equity earnings of $6.9 million for the three month period ended March 31, 2009 were generated from technology licensing and catalyst sales for various proprietary technologies in joint venture investments within Lummus Technology. Equity earnings during the comparable prior year period were $6.0 million.
Selling and Administrative Expenses-Selling and administrative expenses for the three months ended March 31, 2009 were $59.2 million, or 4.6% of revenue, compared with $63.9 million, or 4.4% of revenue, for the comparable period in 2008. The absolute dollar decrease as compared to 2008 is generally attributable to a reduction in our global and business sector administrative support costs. Other Operating Expense-Other operating expense during the three months ended March 31, 2009 primarily relates to severance costs incurred in connection with the reorganization of our business sectors and severance and

other related costs associated with the closure of three fabrication facilities in the U.S., which we expect to be completed by the fourth quarter of 2009. Income from Operations-Income from operations for the three months ended March 31, 2009 was $80.3 million versus $62.3 million during the prior year period. Our first quarter 2009 results were favorably impacted by overall higher gross profit margins, lower selling and administrative costs, and higher equity earnings, partly offset by severance and facility closure costs.
Interest Expense and Interest Income-Interest expense for the first quarter of 2009 was $5.5 million, compared with $4.5 million for the corresponding 2008 period. The $1.0 million increase was primarily due to borrowings on our revolving credit facility during the current period. Interest income of $0.4 million for the first quarter 2009 decreased $2.8 million compared to the same period in 2008 due to lower short-term investment levels resulting from cash utilized to fund project losses in the U.K.
Income Tax Expense-Income tax expense for the three months ended March 31, 2009 was $25.2 million, or 33.5% of pre-tax income, versus $17.1 million, or 28.0% in the comparable period of 2008. The rate increase compared with the corresponding period of 2008 is primarily due to a change in the U.S./non-U.S. income mix. Minority Interest-Net income attributable to minority interest for the three months ended March 31, 2009 was $1.3 million compared with $1.7 million for the comparable period in 2008. The changes compared with 2008 are commensurate with the levels of operating income for the contracting entities. Liquidity and Capital Resources
At March 31, 2009, cash and cash equivalents totaled $91.7 million. Operating-During the first quarter of 2009, cash used in operating activities totaled $43.8 million, as an increase in contracts in progress balances in support of our major CB&I Lummus projects was partially offset by overall profitability.
Investing-In the first quarter of 2009, we incurred $17.2 million for capital expenditures, primarily in support of projects and facilities within our CB&I Steel Plate Structures sector.
We continue to evaluate and selectively pursue opportunities for additional expansion of our business through the acquisition of complementary businesses. These acquisitions, if they arise, may involve the use of cash or may require further debt or equity financing.
Financing-During the first quarter of 2009, net cash flows generated from financing activities totaled $64.0 million, primarily as a result of net borrowings of $62.0 million under our revolving credit facility, which we periodically utilize for operating needs. Cash provided by financing activities also included $2.8 million from the issuance of shares for stock-based compensation. Dividends were suspended, beginning in the first quarter of 2009. Our primary internal source of liquidity is cash flow generated from operations. Capacity under a revolving credit facility is also available, if necessary, to fund operating or investing activities. We have a five-year, $1.1 billion, committed and unsecured revolving credit facility, which terminates in October 2011. As of March 31, 2009, $62.0 million of direct borrowings were outstanding under the revolving credit facility. Additionally, we had issued $287.3 million of letters of credit under the five-year facility. Such letters of credit are generally issued to customers in the ordinary course of business to support advance payments, performance guarantees or in lieu of retention on our contracts. As of March 31, 2009, we had $750.7 million of available capacity under this facility. The facility contains a borrowing sublimit of $550.0 million and certain restrictive covenants, the most restrictive of which include a maximum leverage ratio, a minimum fixed charge coverage ratio and a minimum net worth level. The facility also places restrictions on us with regard to subsidiary indebtedness, sales of assets, liens, investments, type of business conducted and mergers and acquisitions, among other restrictions.

In addition to the revolving credit facility, we have three committed and unsecured letter of credit and term loan agreements (the "LC Agreements") with Bank of America, N.A., as administrative agent, JPMorgan Chase Bank, N.A., and various private placement note investors. Under the terms of the LC Agreements, either banking institution (the "LC Issuers") can issue letters of credit. In the aggregate, the LC Agreements provide up to $275.0 million of capacity. As of March 31, 2009, no direct borrowings were outstanding under the LC Agreements, but we had issued $273.4 million of letters of credit among all three tranches of LC Agreements. Tranche A, a $50.0 million facility, and Tranche B, a $100.0 million facility, are both five-year facilities which terminate in November 2011 and were fully utilized at March 31, 2009. Tranche C, an eight-year, $125.0 million facility expiring in November 2014, had $1.6 million of available capacity at March 31, 2009. The LC Agreements contain certain restrictive covenants, the most restrictive of which include a minimum net worth level, a minimum fixed charge coverage ratio and a maximum leverage ratio. The LC Agreements also include restrictions with regard to subsidiary indebtedness, sales of assets, liens, investments, type of business conducted, affiliate transactions, sales and leasebacks, and mergers and acquisitions, among other restrictions. In the event of default under the LC Agreements, including our failure to reimburse a draw against an issued letter of credit, the LC Issuer could transfer its claim against us, to the extent such amount is due and payable by us, no later than the stated maturity of the respective LC Agreement. In addition to quarterly letter of credit fees that we pay under the LC Agreements, to the extent that a term loan is in effect, we would also be assessed a floating rate of interest over LIBOR.
We also have various short-term, uncommitted revolving credit facilities across several geographic regions of approximately $1.3 billion. These facilities are generally used to provide letters of credit or bank guarantees to customers in the ordinary course of business to support advance payments, performance guarantees or in lieu of retention on our contracts. At March 31, 2009, we had available capacity of $583.8 million under these uncommitted facilities. In addition to providing letters of credit or bank guarantees, we also issue surety bonds in the ordinary course of business to support our contract performance. In addition, we have a $160.0 million unsecured term loan facility with JPMorgan Chase Bank, N.A., as administrative agent, and Bank of America, N.A., as syndication agent. Interest under the Term Loan is based upon LIBOR plus an applicable floating spread and is paid quarterly in arrears. We also have an interest rate swap that provides for an interest rate of approximately 6.32%, inclusive of the applicable floating spread. The Term Loan will continue to be repaid in equal installments of $40.0 million per year, with the last principal payment due in November 2012. The Term Loan contains similar restrictive covenants to the ones noted above for the revolving credit facility. We could be impacted as a result of the current global financial and economic crisis if our customers delay or cancel projects, if our customers experience a material change in their ability to pay us, we are unable to meet our restrictive covenants, or the banks associated with our current, committed and unsecured revolving credit facility, committed and unsecured letter of credit and term loan agreements, and uncommitted revolving credit facilities were to cease or reduce operations.
We were in compliance with all restrictive lending covenants as of March 31, 2009; however, our ability to remain in compliance and the availability of such lending facilities could be impacted by circumstances or conditions beyond our control caused by the global financial and economic crisis, including but not limited to, cancellation of contracts, changes in currency exchange or interest rates, performance of pension plan assets, or changes in actuarial assumptions. As of March 31, 2009, the following commitments were in place to support our ordinary course obligations:

                                                                 Amounts of Commitments by Expiration Period

(In thousands)                            Total           Less than 1 Year         1-3 Years          4-5 Years          After 5 Years

Letters of Credit/Bank Guarantees      $ 1,273,647        $         589,116        $  608,460        $    39,474        $        36,597
Surety Bonds                               251,965                  168,866            83,089                 10                      -

Total Commitments                      $ 1,525,612        $         757,982        $  691,549        $    39,484        $        36,597

Note: Letters of credit include $32.9 million of letters of credit issued in support of our insurance program.
The equity and credit markets have recently experienced dramatic turmoil. A continuation of this level of volatility in the credit markets may increase costs associated with issuing letters of credit under our short-term, uncommitted credit facilities. Notwithstanding these adverse conditions, we believe that our cash on hand, funds generated by operations, amounts available under existing, committed credit facilities and external sources of liquidity, such as the issuance of debt and equity instruments, will be sufficient to finance our capital expenditures, the settlement of commitments and contingencies (as more fully described in Note 8 to our Condensed Consolidated Financial Statements) and our working capital needs for the foreseeable future. However, there can be no assurance that such funding will be available, as our ability to generate cash flows from operations and our ability to access funding under the revolving credit facility and LC Agreements may be impacted by a variety of business, economic, legislative, financial and other factors, which may be outside of our control. Additionally, while we currently have significant, uncommitted bonding facilities, primarily to support various commercial provisions in our contracts, a termination or reduction of these bonding facilities could result in the utilization of letters of credit in lieu of performance bonds, thereby reducing our available capacity under the revolving credit facility. Although we do not anticipate a reduction or termination of the bonding facilities, there can be no assurance that such facilities will be available at reasonable terms to service our ordinary course obligations.
We are a defendant in a number of lawsuits arising in the normal course of business and we have in place appropriate insurance coverage for the type of work that we have performed. As a matter of standard policy, we review our litigation accrual quarterly and as further information is known on pending cases, increases or decreases, as appropriate, may be recorded in accordance with SFAS No. 5, "Accounting for Contingencies" ("SFAS No. 5").
For a discussion of pending litigation, including lawsuits wherein plaintiffs allege exposure to asbestos due to work we may have performed, see Note 8 to our Condensed Consolidated Financial Statements. Off-Balance Sheet Arrangements
We use operating leases for facilities and equipment when they make economic sense, including sale-leaseback arrangements. We have no other significant off-balance sheet arrangements.
New Accounting Standards
For a discussion of new accounting standards, see the applicable section included within Note 1 to our Condensed Consolidated Financial Statements. 2008 Quarterly Segment Information
As discussed above, beginning in the first quarter of 2009, our management structure and internal and public segment reporting were aligned based upon three distinct business sectors, rather than our historical practice of reporting based upon discrete geographic regions and Lummus Technology. These three project business sectors are CB&I Steel Plate Structures, CB&I Lummus (which includes Energy Processes and LNG terminal projects) and Lummus Technology.
The following represents our prior year 2008 quarterly results reported under our current reporting structure:

                                                                 Three Months Ended
                                      March 31,          June 30,           September 30,          December 31,          Full Year
                                        2008               2008                 2008                   2008                2008

New Awards

CB&I Steel Plate Structures          $   498,994        $   966,439        $       338,427        $      758,739        $ 2,562,599
CB&I Lummus                              209,580            506,359                220,335               282,716          1,218,990
Lummus Technology                        234,411             97,437                144,918                28,437            505,203

Total new awards                     $   942,985        $ 1,570,235        $       703,680        $    1,069,892        $ 4,286,792



Revenue

CB&I Steel Plate Structures          $   451,117        $   508,869        $       500,489        $      551,436        $ 2,011,911
CB&I Lummus                              891,196            791,120                952,669               859,413          3,494,398
Lummus Technology                         97,111            128,472                110,551               102,538            438,672

Total revenue                        $ 1,439,424        $ 1,428,461        $     1,563,709        $    1,513,387        $ 5,944,981



Income From Operations

CB&I Steel Plate Structures          $    49,832        $    53,822        $        54,108        $       56,624        $   214,386
CB&I Lummus                               (9,809 )         (286,868 )              (29,623 )              36,365           (289,935 )
Lummus Technology                         22,233             33,288                 27,337                27,901            110,759

Total income from operations         $    62,256        $  (199,758 )      $        51,822        $      120,890        $    35,210

Critical Accounting Estimates
The discussion and analysis of financial condition and results of operations are based upon our condensed consolidated 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 disclosure of contingent assets and liabilities. We evaluate our estimates on an on-going basis, based on historical experience and on various other assumptions that are believed 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 of Directors. 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 condensed consolidated financial statements:
Revenue Recognition-Revenue is primarily recognized using the percentage-of-completion method. Our contracts are awarded on a competitive bid and negotiated basis. We offer our customers a range of contracting options, including fixed-price, cost reimbursable and hybrid approaches. Contract revenue is primarily recognized based on the percentage that actual costs-to-date bear to total estimated costs. We utilize this cost-to-cost approach as we believe this method is less subjective than relying on assessments of physical progress. We follow the guidance of SOP 81-1 for accounting policies relating to our use of the percentage-of-completion method, estimating costs, revenue recognition, including the recognition of profit incentives, combining and segmenting contracts and unapproved change order/claim recognition. Under the cost-to-cost approach, the most widely recognized method used for percentage-of-completion accounting, the use of estimated cost 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. 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 the reversal of any profit recognized in prior periods. Due to the various estimates inherent in our contract accounting, actual results could differ from those estimates. Contract revenue reflects the original contract price adjusted for approved change orders and estimated minimum recoveries of unapproved change orders and claims. We recognize revenue associated with unapproved change orders and claims to the extent that related costs have been incurred when recovery is probable and the value can be reliably estimated. At March 31, 2009 and December 31, 2008, we had projects with outstanding unapproved change orders/claims of approximately $30.0 million and $50.0 million, respectively, factored into the determination of their revenue and estimated costs. If the final settlements are less than the recorded unapproved change orders and claims, our results of operations could be negatively impacted.
Losses expected to be incurred on contracts in progress are charged to earnings in the period such losses become known. For projects in a significant loss position, we recognized losses of approximately $24.0 million for the period ended March 31, 2009. Recognized losses during the prior year period ended March 31, 2008 were approximately $12.9 million.
Credit Extension-We extend credit to customers and other parties in the normal course of business only after a review of the potential customer's creditworthiness. Additionally, management reviews the commercial terms of all significant contracts before entering into a contractual arrangement. We regularly review outstanding receivables and provide for estimated losses through an allowance for doubtful accounts. In evaluating the level of established reserves, management makes judgments regarding the parties' ability to make required payments, economic events and other factors. As the financial condition of these parties changes, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required.
Financial Instruments-Although we do not engage in currency speculation, we periodically use forward contracts to mitigate certain operating exposures, as well as hedge intercompany loans utilized to finance non-U.S. subsidiaries. Hedge contracts utilized to mitigate operating exposures are generally designated as "cash flow hedges" under SFAS No. 133. Therefore, gains and losses, exclusive of forward points and credit risk, are included in accumulated other comprehensive income/loss on the condensed consolidated balance sheets until the associated offsetting underlying operating exposure impacts our earnings. Gains and losses associated with instruments deemed ineffective during the period, if any, and instruments for which we do not seek hedge accounting treatment, including those instruments used to hedge intercompany loans, are . . .