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The Shaw Group Announces Financial Results for First Quarter of Fiscal 2003

BATON ROUGE, La.--(BUSINESS WIRE)--Jan. 13, 2003--The Shaw Group Inc. (NYSE: SGR) ("Shaw" or "the Company") today announced earnings of $16.5 million, or $0.42 per diluted share, for the first quarter ended November 30, 2002. This compares to earnings of $19.0 million, or $0.45 per diluted share, for the three months ended November 30, 2001. Revenue for the first quarter of fiscal 2003 increased 120% reaching $996.9 million, compared to $453.6 million for the first quarter of fiscal 2002.

Shaw's backlog totaled $5.0 billion at November 30, 2002. This represents an 11% increase over the $4.5 billion backlog reported at November 30, 2001. Contributing to this backlog was approximately $457 million in new awards booked during the quarter, including approximately $220 million from the Company's environmental and infrastructure division. Approximately 47% of the total backlog, or $2.4 billion, is expected to be worked off during the next 12 months. Eighty-eight percent of Shaw's backlog is for projects in the United States.

"Strong bidding activity and steady bookings of new work highlight our first quarter operations and bring our fiscal year off to a good start," stated J. M. Bernhard, Jr., Shaw's Chairman, President and Chief Executive Officer. "Our financial results for the quarter are solid, and we hope to continue this trend as we work off what we believe to be a stable and profitable backlog of projects. Furthermore, our environmental and infrastructure business is progressing at an impressive pace with significant new awards that help to confirm a successful integration effort."

The Shaw Group Inc. is a leading global provider of comprehensive services to the power, process, and environmental and infrastructure industries. Shaw is a vertically-integrated provider of comprehensive engineering, procurement, pipe fabrication, construction and maintenance services to the power and process industries. Shaw is also a leader in the environmental, infrastructure and homeland defense markets providing consulting, engineering, construction, remediation and facilities management services to governmental and commercial customers. The Company is headquartered in Baton Rouge, Louisiana with offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region and employs approximately 17,000 people.

For more information on The Shaw Group Inc., please contact Christine Mollere, Vice President of Corporate Communications at 225-932-2500.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained herein that are not historical facts (including without limitation statements to the effect that the Company or its management "believes," "expects," "anticipates," "plans," or other similar expressions) and statements related to revenues, earnings, backlog, or other financial information or results are forward-looking statements based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. These forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions and are subject to change based upon various factors. Should one or more of such risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. A description of some of the risks and uncertainties that could cause actual results to differ materially from such forward-looking statements can be found in the Company's reports and registration statements filed with the Securities and Exchange Commission, including its Form 10-K and Form 10-Q, reports and on the Company's web-site under the heading "Forward Looking Statement". These documents are also available from the Securities and Exchange Commission or from the Investor Relations department of Shaw. For more information on the company and announcements it makes from time to time on a regional basis visit our web site at

                          The Shaw Group Inc.
                   Consolidated Statements of Income
               (In thousands, except per share amounts)
                                                    Three Months Ended
                                                        November 30,
                                                       2002     2001
                                                     -------- --------
   Sales                                            $996,906 $453,609
   Cost of sales                                     914,480  390,899
                                                     -------- --------
     Gross profit                                     82,426   62,710
General and administrative expenses                   49,892   30,908
                                                     -------- --------
Operating income                                      32,534   31,802
Interest expense                                      (5,774)  (5,805)
Interest income                                        1,539    3,022
Other income, net                                        (99)     367
                                                     -------- --------
                                                      (4,334)  (2,416)
                                                     -------- --------
Income before income taxes and earnings (losses)
 from unconsolidated entities                         28,200   29,386
Provision for income taxes                            10,152   10,585
                                                     -------- --------
Income before earnings (losses) from unconsolidated
 entities                                             18,048   18,801
Earnings (losses) from unconsolidated entities (net
 of taxes)                                            (1,595)     151
                                                     -------- --------
Net Income                                          $ 16,453 $ 18,952
                                                     ======== ========
Basic income per common share:
   Net income available to common shareholders      $ 16,453 $ 18,952
                                                     ======== ========
   Number of shares                                   38,417   40,834
                                                     ======== ========
   Net income per common share                      $   0.43 $   0.46
                                                     ======== ========
Diluted income per common share:
   Net income available to common shareholders      $ 16,453 $ 18,952
   Interest on convertible debt, net of taxes          2,632    2,632
                                                     -------- --------
   Net income for diluted computation               $ 19,085 $ 21,584
                                                     ======== ========
   Number of shares                                   45,423   48,465
                                                     ======== ========
   Diluted income per common share                  $   0.42 $   0.45
                                                     ======== ========
                          Revenue by Industry
                (First Quarter Ended November 30, 2002)
Power Generation                        $   560.7 million     56 %
Environmental & Infrastructure          $   317.6 million     32 %
Process Industries                      $    73.0 million      7 %
Other Industries                        $    45.6 million      5 %
                                        -----------------    -----
Total                                   $   996.9 million    100 %
                         Revenue by Geography
                (First Quarter Ended November 30, 2002)
United States                           $   874.3 million     88 %
Asia/Pacific Rim                        $    48.2 million      5 %
Other North American                    $    40.2 million      4 %
Europe                                  $    22.6 million      2 %
South America                           $     6.5 million      1 %
Other                                   $     3.0 million      0 %
Middle East                             $     2.1 million      0 %
                                        -----------------    -----
Total                                   $   996.9 million    100 %
                          Backlog by Industry
                        (At November 30, 2002)
Environmental & Infrastructure           $2,264.3 million     45 %
Power Generation
  Nuclear Power                          $1,156.2 million     23 %
  Fossil Fuel EPC                        $  612.2 million     12 %
  Other Power                            $  382.3 million      8 %
Process Industries                       $  527.3 million     11 %
Other Industries                         $   59.5 million      1 %
                                         ----------------    -----
Total                                    $5,001.8 million    100 %
                         Backlog by Geography
                        (At November 30, 2002)
Domestic                                 $4,401.2 million     88 %
International                            $  600.6 million     12 %
                                         ----------------    -----
Total                                    $5,001.8 million    100 %


CONTACT: The Shaw Group Inc., Baton Rouge
Christine Mollere, 225/932-2500

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding SHAW GROUP INC's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.

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