UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION

                          Washington, D.C. 20549
                                   FORM 10-Q

                       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                           OF THE SECURITIES EXCHANGE ACT OF 1934


    For the quarterly period ended                Commission file number
          June 30, 2001                                  000-23943

                           PETER KIEWIT SONS', INC.
           (Exact name of registrant as specified in its charter)

               Delaware                                91-1842817
      (State of Incorporation)           (I.R.S. Employer Identification No.)


              Kiewit Plaza, Omaha Nebraska                        68131
(Address of principal executive offices)                        (Zip Code)


(402) 342-2052
(Registrant's telephone number, including area code)

          Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes [X]
No [  ]

          The number of shares outstanding of each of the registrant's
classes of common stock as of August 13, 2001:

                 Title of Class                     Shares Outstanding
           Common Stock, $0.01 par value                31,053,065


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                                PETER KIEWIT SONS', INC.

                                      Index
                                                                         Page

                         PART I - FINANCIAL INFORMATION
                         ------------------------------



Item 1.  Financial Statements.

         Consolidated Condensed Statements of Earnings for the three
           and six months ended June 30, 2001 and 2000                      1

         Consolidated Condensed Balance Sheets as of June 30, 2001 and
           December 30, 2000                                                2

         Consolidated Condensed Statements of Cash Flows for the
           six months ended June 30, 2001 and 2000                          3

         Notes to Consolidated Condensed Financial Statements               4

Item 2.  Management's Discussion and Analysis of Financial Condition and
           Results of Operations.                                          11

Item 3.  Quantitative and Qualitative Disclosure about Market Risk.        14

                        PART II - OTHER INFORMATION
                        ---------------------------

Item 1.  Legal Proceedings.                                                14

Item 4.  Submission of Matters to a Vote of Security Holders.              15

Item 6.  Exhibits and Reports on Form 8-K.                                 15

         Signatures                                                        15
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                           PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

                              PETER KIEWIT SONS', INC.
                     Consolidated Condensed Statements of Earnings
                                    (unaudited)


                              Three Months Ended             Six Months Ended
                                   June 30,                       June 30,
                              ------------------             ----------------
(dollars in millions, except
  per share data)               2001      2000                2001     2000
-----------------------------------------------------------------------------

Revenue                        $  968   $ 1,189            $ 1,940   $ 2,175
Cost of revenue                  (893)   (1,094)            (1,819)   (2,036)
                               ------   -------            -------   -------
                                  75        95                 121       139

General and administrative
  expenses                       (44)      (45)                (92)      (88)
Gain on sale of operating assets   7         6                  11        10
                             -------   -------             -------   -------

Operating earnings                38        56                  40        61

Other income (expense):
   Investment income and equity
     earnings                      4         4                   9        10
   Interest expense               (1)       (2)                 (1)       (3)
   Other, net                      4        11                   7        20
                             -------   -------             -------   -------
                                   7        13                  15        27
                             -------   -------             -------   -------
Earnings before income taxes,
  minority interest and
  discontinued operations         45        69                  55        88

Minority interest in net
  earnings of subsidiaries         -         -                  (1)        -

Provision for income taxes       (18)      (27)                (22)      (35)
                             -------   -------             -------   -------

Earnings from continuing
  operations                      27        42                  32        53

Discontinued operations:
  Income from materials
   operations, net of income
   tax expense of $- and $6
   and $- and $8                   -         8                   -        11
                             -------   -------             -------   -------

Net earnings                 $    27   $    50             $    32   $    64
                             =======   =======             =======   =======

Net earnings per share:

Continuing operations:

  Basic                      $   .91   $  1.32             $  1.08   $  1.66
                             =======   =======             =======   =======
  Diluted                    $   .88   $  1.28             $  1.04   $  1.61
                             =======   =======             =======   =======

Discontinued operations:
  Basic                      $     -   $   .25             $     -   $   .35
                             =======   =======             =======   =======
  Diluted                    $     -   $   .24             $     -   $   .34
                             =======   =======             =======   =======

Net earnings:
  Basic                      $   .91   $  1.57             $  1.08   $  2.01
                             =======   =======             =======   =======
  Diluted                    $   .88   $  1.52             $  1.04   $  1.95
                             =======   =======             =======   =======

See accompanying notes to consolidated condensed financial statements.

                                             1
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                            PETER KIEWIT SONS', INC.

                        Consolidated Condensed Balance Sheets


                                                June 30,         December 30,
                                                  2001               2000
(dollars in millions)                         (unaudited)
-----------------------------------------------------------------------------
Assets
Current assets:
  Cash and cash equivalents                     $   263            $   302
  Marketable securities                               4                  5
  Receivables, less allowance of $4 and $4          525                463
  Unbilled contract revenue                         119                 97
  Contract costs in excess of related revenue        46                 58
  Investment in construction joint ventures         115                138
  Deferred income taxes                              69                 60
  Other                                              14                 10
                                                -------            -------
Total current assets                              1,155              1,133

Property, plant and equipment, less accumulated
  depreciation and amortization of $430 and $424    208                188
Other assets                                        112                 96
Deferred income taxes                                 6                  9
                                                -------            -------
                                                $ 1,481            $ 1,426
                                                =======            =======

Liabilities and redeemable common stock

Current liabilities:
  Accounts payable, including retainage of
    $62 and $56                                 $   208            $   223
  Current portion of long-term debt                   1                  1
  Accrued costs on construction contracts           186                133
  Billings in excess of related costs and earnings  172                145
  Accrued insurance costs                            67                 64
  Accrued payroll                                    23                 34
  Other                                              15                 22
                                                -------            -------
Total current liabilities                           672                622

Long-term debt, less current portion                 12                 12
Other liabilities                                    86                 82
Minority interest                                    14                 14
                                                -------            -------
  Total liabilities                                 784                730
                                                -------            -------

Preferred stock, no par value, 250,000 shares
  authorized, no shares outstanding                  -                   -
Redeemable common stock ($541 million aggregate
  redemption value):
    Common stock, $0.01 par value; 125 million
    shares authorized 31,180,254 and 32,259,640
    shares outstanding                               -                   -
  Additional paid-in capital                        197                185
  Accumulated other comprehensive income             (8)                (7)
  Retained earnings                                 508                518
                                                -------            -------

Total redeemable common stock                       697                696
                                                -------            -------
                                                $ 1,481            $ 1,426
                                                =======            =======

See accompanying notes to consolidated condensed financial statements.
                                            2
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                             PETER KIEWIT SONS', INC.

                 Consolidated Condensed Statements of Cash Flows
                                      (unaudited)


                                                            Six Months Ended
                                                                June 30,
                                                            -----------------
(dollars in millions)                                        2001       2000
-----------------------------------------------------------------------------

Cash flows from operations:
  Net cash provided by operations                          $    55   $   105
                                                           -------   -------

Cash flows from investing activities:
  Proceeds from sales and maturities of marketable securities    4         9
  Purchases of marketable securities                             -        (2)
  Proceeds from sales of property, plant and equipment          15        14
  Investments and acquisitions                                 (20)      (37)
  Capital expenditures                                         (53)      (53)
  Additions to notes receivable                                 (1)       (4)
  Payments received on notes receivable                          -         1
                                                           -------   -------
    Net cash used in investing activities                      (55)      (72)
                                                           -------   -------

Cash flows from financing activities:
  Long-term debt payments                                        -        (2)
  Issuance of common stock                                      27         -
  Repurchases of common stock                                  (47)      (63)
  Dividends paid                                               (19)      (18)
                                                           -------   -------
    Net cash used in financing activities                      (39)      (83)
                                                           -------   -------

Net decrease in cash and cash equivalents                      (39)      (50)

Cash and cash equivalents at beginning of period               302       338
                                                           -------   -------

Cash and cash equivalents at end of period                 $   263   $   288
                                                           =======   =======

Noncash investing activities:
  Issuance of debt for materials acquisition               $     -   $     2
                                                           =======   =======

See accompanying notes to consolidated condensed financial statements.


                                          3
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                          PETER KIEWIT SONS', INC.

          Notes to Consolidated Condensed Financial Statements


1.  Basis of Presentation:

The consolidated condensed balance sheet of Peter Kiewit Sons', Inc. (the
"Company") at December 30, 2000 has been condensed from the Company's audited
balance sheet as of that date.  All other financial statements contained
herein are unaudited and, in the opinion of management, contain all
adjustments (consisting only of normal recurring accruals) necessary for a
fair presentation of financial position and results of operations and cash
flows for the periods presented.  The Company's accounting policies and
certain other disclosures are set forth in the notes to the consolidated
financial statements contained in the Company's Annual Report on Form 10-K.

Receivables at June 30, 2001 and December 30, 2000 include approximately $109
million and $116 million, respectively, of retainage on uncompleted projects,
the majority of which is expected to be collected within one year.  Included
in the retainage amounts are $30 million and $29 million, respectively, of
securities which are being held by the owners of various construction
projects in lieu of retainage.  Also included in accounts receivable are $1
million and $10 million, respectively, of securities held by the owners which
are now due as the contracts are completed.  These securities are carried at
fair value which is determined based on quoted market prices for the
securities on hand or for similar investments.  Net unrealized holding gains
and losses, if any, are reported as a separate component of accumulated other
comprehensive income, net of tax.

     The results of operations for the six months ended June 30, 2001 are not
necessarily indicative of the results to be expected for the full year.

     When appropriate, items within the consolidated condensed financial
statements have been reclassified in the previous periods to conform to
current year presentation.


2.  Discontinued Operations:

In accordance with Accounting Principles Board Opinion No. 30 "Reporting the
Results of Operations - Reporting the Effects of Disposal of a Segment of
a Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions" ("APB 30"), the consolidated condensed statement of earnings of
the Company for the three and six months ended June 30, 2000 have been
reclassified to reflect the spin-off of the Company's materials business (the
"Materials Business") that occurred on September 30, 2000.  Accordingly, the
revenues, costs and expenses of the Materials Business have been segregated
in the Consolidated Condensed Statements of Earnings.  The net operating
results of the Materials Business have been reported as "Discontinued
Operations" in the accompanying consolidated condensed financial statements.

Summarized financial information for the discontinued operations follows:


                                            4
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                                 PETER KIEWIT SONS', INC.

           Notes to Consolidated Condensed Financial Statements - (Continued)


2.  Discontinued Operations (Continued):
                                     Three Months Ended      Six Months Ended
                                           June 30,               June 30,
 (dollars in millions)                       2000                   2000
-----------------------------------------------------------------------------

Revenues                                  $   127                  $   227
                                          =======                  =======
Income from discontinued operations(after
  applicable income taxes of $6 and $8)         8                  $    11
                                          =======                  =======


3.  Investments and Acquisitions:

On January 3, 2000, the Company acquired 100% of the outstanding common stock
and related assets of Solano Concrete Co., Inc., a materials operation
operating in the Northern California area, for $31 million.  This operation
was included with the spin-off of the Materials Business (Note 7).

On September 26, 2000, the Company acquired 100% of Walnut Creek Mining
Company, a lignite mining business located in Robertson County, Texas, for
$94 million.  The fair value of the identifiable assets acquired and
liabilities assumed was $110 million and $16 million, respectively.
Identifiable intangibles assets related to this purchase will be amortized
over their useful life of 15 years.  No goodwill related to this transaction
was recorded.  The following unaudited, pro-forma financial information
assumes the acquisition occurred at the beginning of 2000.  These results
have been prepared for comparative purposes only and do not purport to be
indicative of what would have occurred had the acquisition been made at the
beginning of 2000, or the results which may occur in the future.


                                     Three Months Ended      Six Months Ended
                                           June 30,              June 30,
                                     ------------------      ----------------
(dollars in millions)                 2001        2000        2001      2000
-----------------------------------------------------------------------------

Revenue                             $   968     $ 1,197     $ 1,940   $ 2,191
                                    =======     =======     =======   =======
Net earnings                        $    27     $    51     $    32   $    67
                                    =======     =======     =======   =======

Net earnings per share:
  Basic                             $   .91     $  1.61     $  1.08   $  2.09
                                    =======     =======     =======   =======
  Diluted                           $   .88     $  1.56     $  1.04   $  2.03
                                    =======     =======     =======   =======



On April 2, 2001, the Company invested $20 million in an investment limited
partnership.  The Company accounts for this investment using the equity
method.

                                          5
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                            PETER KIEWIT SONS', INC.

     Notes to Consolidated Condensed Financial Statements - (Continued)


4.  Earnings Per Share:

Basic earnings per share has been computed using the weighted average number
of shares outstanding during each period.  Diluted earnings per share gives
effect to convertible debentures considered to be dilutive common stock
equivalents.  The potentially dilutive convertible debentures are calculated
in accordance with the "if converted" method.  This method assumes that the
after-tax interest expense associated with the debentures is an addition to
income and the debentures are converted into equity with the resulting common
shares being aggregated with the weighted average shares outstanding.

                                     Three Months Ended      Six Months Ended
                                         June 30,                June 30,
                                     ------------------      ----------------
                                      2001        2000        2001      2000
-----------------------------------------------------------------------------

Earnings from continuing operations
  (in millions)                     $   27       $   42      $   32    $   53

Earnings from discontinued operations    -            8           -        11
                                    ------       ------      ------    ------
Net earnings available to common
  stockholders                          27           50          32        64

Add:  Interest expense, net of tax effect,
  associated with convertible debentures *            *           *         *
                                    ------       ------      ------    ------

Net earnings for diluted shares     $   27       $   50      $   32    $   64
                                    ======       ======      ======    ======

Total number of weighted average
  shares outstanding used to
  compute basic earnings per share
  (in thousands)                    29,697       31,878      29,778    32,119

Additional dilutive shares assuming
  conversion of convertible
  debentures                         1,367        1,025       1,367     1,027
                                    ------       ------      ------    ------

Total number of shares used to
  compute diluted earnings per
  share                             31,064       32,903       31,145   33,146
                                    ======       ======       ======   ======
Continuing operations:
  Basic earnings per share          $  .91       $ 1.32       $ 1.08   $ 1.66
                                    ======       ======       ======   ======
  Diluted earnings per share        $  .88       $ 1.28       $ 1.04   $ 1.61
                                    ======       ======       ======   ======

Discontinued operations:
  Basic earnings per share          $    -       $  .25       $    -   $  .35
                                    ======       ======       ======   ======
  Diluted earnings per share        $    -       $  .24       $    -   $  .34
                                    ======       ======       ======   ======

Net earnings:
  Basic earnings per share          $  .91       $ 1.57       $ 1.08   $ 2.01
                                    ======       ======       ======   ======
  Diluted earnings per share        $  .88       $ 1.52       $ 1.04   $ 1.95
                                    ======       ======       ======   ======

* Interest expense attributable to convertible debentures was less than $.5
million

                                                  6
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                               PETER KIEWIT SONS', INC.

          Notes to Consolidated Condensed Financial Statements - (Continued)

5.  Comprehensive Income:

Comprehensive income includes net income, unrealized gains (losses) on
securities and foreign currency translation adjustments which are charged or
credited to the cumulative translation account within Redeemable Common
Stock.  Comprehensive income for the three and six months ended June 30, 2001
and 2000 was as follows:

                                     Three Months Ended      Six Months Ended
                                           June 30,              June 30,
                                     ------------------      ----------------
(dollars in millions)                 2001        2000        2001      2000
-----------------------------------------------------------------------------
Net earnings                         $   27      $   50      $   32   $   64
Other comprehensive income, before tax:
  Foreign currency translation
   adjustments                            3           2          (1)       2
  Unrealized gains (losses) arising
    during period                         -          (4)          -       (4)
  Income tax effect related to items of
    other comprehensive income           (1)          1           -        1
                                     ------      ------      ------   ------
Comprehensive income                 $   29      $   49      $   31   $   63
                                     ======      ======      ======   ======


6.     Segment Data:

The Company primarily operates in the construction industry and currently has
one reportable operating segment.  The Company's other operations consist of
the lignite mining operation acquired on September 26, 2000.  The
Construction segment performs services for a broad range of public and
private customers primarily in North America.  Construction services are
performed in the following construction markets:  transportation (including
highways, bridges, airports, railroads and mass transit), commercial
buildings, water supply, sewage and waste disposal, dams, mining, power,
telecommunication infrastructure, heating and cooling, and oil and gas.  As
described in Note 2, the Company has reclassified the results of operations
of its Materials Business as discontinued operations.  The Materials Business
was previously disclosed as a separate operating segment.  The following
segment data has been restated to exclude amounts related to the Materials
Business.

Intersegment sales are recorded at cost.  Operating earnings is comprised of
net sales less all identifiable operating expenses, allocated general and
administrative expenses, gain on sale of operating assets, depreciation and
amortization.  Investment income, interest expense and income taxes have been
excluded from segment operations.  The management fee earned by the Company
for mine management and related services to the coal mining operations of
Level 3 Communications, Inc. ("Level 3") is excluded from the segment
information that follows as it is included in other income on the Statement
of Earnings and not included in operating earnings.  Segment asset
information has not been presented as it is not reported to or reviewed by
the chief operating decision maker.

                                   Three Months Ended     Three Months Ended
                                      June 30, 2001         June 30, 2000
                                  --------------------    -------------------
dollars in millions)              Construction   Other    Construction  Other
-----------------------------------------------------------------------------

Revenue - external customers     $  958         $   10       $1,189    $    -
                                 ======         ======       ======    ======
Operating earnings               $   36         $    2       $   56    $    -
                                 ======         ======       ======    ======

                                             7
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                          PETER KIEWIT SONS', INC.

          Notes to Consolidated Condensed Financial Statements - (Continued)

6.  Segment Data (Continued):

                                  Six Months Ended       Six Months Ended
                                    June 30, 2001          June 30, 2000
                                  --------------------   --------------------
(dollars in millions)             Construction   Other    Construction  Other
-----------------------------------------------------------------------------

Revenue - external customers         $1,920     $   20       $2,175    $    -
                                     ======     ======       ======    ======
Operating earnings                   $   35     $    5       $   61    $    -
                                     ======     ======       ======    ======

During the quarters ended June 30, 2001 and 2000, the Company earned 25.3%
and 45.5%, respectively, of revenues from Level 3.  For the first six months
of 2001, the Company earned 27.5% of revenues from Level 3, as compared to
44.9% for the same period in 2000.



7.  Other Matters:

    Materials Spin-Off:

On September 30, 2000, the Company distributed all of the 32,288,840 shares
of common stock of its former subsidiary, Kiewit Materials Company
("Materials"), it then held to stockholders of the Company in a Spin-off (the
"Materials Spin-off").  In the Materials Spin-off, each stockholder of the
Company received one share of Materials common stock ("Materials' Stock") for
each share of Common Stock they held on the record date for the Materials
Spin-off.  Prior to the Materials Spin-off, the Company also completed a
share exchange offer and debenture exchange offer, pursuant to which holders
of Common Stock and the Company's convertible debentures collectively
exchanged 1,081,226 shares of Common Stock and $13,095,000 principal amount
of the Company's convertible debentures for:  (1) 4,055,029 shares of
Materials' Stock; (2) $670,000 principal amount of Materials' convertible
debentures; and (3) $5,475,045 principal amount of the Company's new reduced
principal convertible debentures.  As a result of the Materials Spin-off, the
Company and Materials now operate as two separate independent companies.

     In connection with the Materials Spin-off, Materials and the Company
entered into various agreements including a Separation Agreement (the
"Materials Separation Agreement") and a Tax Sharing Agreement (the "Materials
Tax Sharing Agreement").

     The Materials Separation Agreement provides for the allocation of
certain risks and responsibilities between Materials and the Company and for
cross-indemnifications that are intended to allocate financial responsibility
to the Company for liabilities arising out of the construction business and
to allocate to Materials liabilities arising out of the Materials Businesses.


                                         8
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                         PETER KIEWIT SONS', INC.

           Notes to Consolidated Condensed Financial Statements - (Continued)

7.  Other Matters (Continued):

Under the Materials Tax Sharing Agreement, with respect to periods, or
portions thereof, ending on or before the  Materials Spin-off, Materials and
the Company generally will be responsible for paying the taxes relating to
such returns, including any subsequent adjustments resulting from the
redetermination of such tax liabilities by the applicable taxing authorities,
that are allocable to the Materials Business and construction business,
respectively.   The Materials Tax Sharing Agreement also provides that
Materials and the Company will indemnify the other from certain taxes and
expenses that would be assessed if the Materials Spin-off were determined to
be taxable, but solely to the extent that such determination arose out of the
breach by Materials or the Company, respectively, of certain representations
made to the Internal Revenue Service in connection with the private letter
ruling issued with respect to the Materials Spin-off.

     Other:

On April 25, 2001, Bibb and Associates, Inc. ("Bibb"), a subsidiary of the
Company, was served with a complaint (the "Complaint") filed in the Circuit
Court of Jackson County, Missouri, in an action brought by Kansas City Power
& Light ("KCPL") with respect to a January 13, 1999 explosion at KCPL's
Hawthorn No. 5 power plant. The Complaint lists a total of 13 defendants, and
generally alleges as to Bibb, strict liability, negligence, professional
gross negligence, fraud, negligent misrepresentation and wrongful inducement
to contract. The Complaint also names the Company, although the Company has
not yet been served, and alleges that the Company is either the alter ego of
Bibb or the successor to Bibb's liability. The Complaint alleges damages in
excess of $450 million, including property damage, costs of replacement of
power, and lost profits. The Company believes that the factual allegations
and legal claims asserted in the Complaint against Bibb and the Company are
without merit and intends to vigorously defend them.  Management believes
that any resulting liability, beyond that provided, should not materially
affect the Company's financial position, future results of operations or
future cash flows.

The Company is involved in various other lawsuits and claims incidental to
its business.  Management believes that any resulting liability, beyond that
provided, should not materially affect the Company's financial position,
future results of operations or future cash flows.

8.     Subsequent Events:

On July 31, 2001, a subsidiary of the Company merged with General
Construction Company ("GCC"), a marine construction business located in
Poulsbo, Washington, pursuant to which the Company acquired 100% of the
outstanding common stock of GCC for approximately $46 million, subject to
adjustment based upon the July 31, 2001 audited balance sheet of GCC.  The
purchase price allocation will be determined when additional information
becomes available.

                                               9
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                              PETER KIEWIT SONS', INC.

          Notes to Consolidated Condensed Financial Statements - (Continued)


9.  Recent Accounting Pronouncements:

The Company adopted Statement of Financial Accounting Standards ("SFAS") No.
133, "Accounting for Derivative Instruments and Hedging Activities," which
establishes accounting and reporting standards for derivative instruments and
for hedging activities, effective January 1, 2001.  Adoption of this
statement did not materially affect the Company's financial statements as the
Company has no significant derivative instruments or hedging activities.

In July 2001, the Financial Accounting Standards Board ("FASB") issued
Statements of Financial Accounting Standards No. 141 (SFAS 141), "Business
Combinations", and No. 142 (FAS 142), "Goodwill and Other Intangible
Assets".

SFAS 141 supersedes Accounting Principles Board Opinion No. 16 (APB 16),
"Business Combinations".  The most significant changes made by SFAS 141 are:
(1) requiring that the purchase method of accounting be used for all business
combinations initiated after June 30, 2001, (2) establishing specific
criteria for the recognition of intangible assets separately from goodwill,
and (3) requiring unallocated negative goodwill to be written off immediately
as an extraordinary gain (instead of being deferred and amortized).

SFAS 142 supersedes APB 17, "Intangible Assets".  SFAS 142 primarily
addresses the accounting for goodwill and intangible assets subsequent to
their acquisition (i.e., the post-acquisition accounting).  The provisions of
SFAS 142 will be effective for fiscal years beginning after December 15,
2001.  The most significant changes made by SFAS 142 are: (1) goodwill and
indefinite-lived intangible assets will no longer be amortized, (2) goodwill
will be tested for impairment at least annually at the reporting unit level,
(3) intangible assets deemed to have an indefinite life will be tested for
impairment at least annually, and (4) the amortization period of intangible
assets with finite lives will no longer be limited to forty years.

We have not yet determined the effect SFAS No. 141 and 142 will have on our
consolidated financial position or results of operations.


                                            10
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                           PETER KIEWIT SONS', INC.


Item 2.  Management's Discussion and Analysis of Financial Condition and
Results of Operations.

     This document contains forward looking statements and information that
are based on the beliefs of management as well as assumptions made by and
information currently available to the Company.  When used in this document,
the words "anticipate," "believe," "estimate," "expect" and similar
expressions, as they relate to the Company or its management, are intended to
identify forward-looking statements.  Such statements reflect the current
views of the Company with respect to future events and are subject to certain
risks or uncertainties and assumptions.  Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in this document.

     On September 30, 2000, the Company effected a spin-off of its Materials
Business to its stockholders.  As described in Note 2 of the Consolidated
Condensed Financial Statements, the Company has reclassified the results of
operations of its Materials Business as discontinued operations.  The
following discussion is on a continuing operations basis.

Results of Operations - Second Quarter 2001 vs. Second Quarter 2000

     Revenue.  Revenue for the second quarter of 2001 decreased $221 million
or 18.6% from the same time period in 2000.  The most significant factor
contributing to this decrease was the reduced work performed on a large fiber
optic project as the work on the project progressed towards completion.

     Contract backlog increased to $4.4 billion at June 30, 2001 (of which
5.6% is attributable to foreign operations located in Canada) from $3.3
billion at December 30, 2000.  Domestic projects are spread geographically
throughout the U.S.

     Margin.  Margins, as a percentage of revenue, for the second quarter of
2001 decreased to 7.7% compared to 8.0% for the same period in 2000.  Margins
may vary between periods due to the inherent uncertainties associated with
fixed price contracts, as well as seasonality and the stage of completion of
individual projects.

     General and Administrative Expenses.  General and administrative
expenses for the second quarter of 2001 decreased $1 million to $44 million
when compared to the same period in 2000.  As a percentage of revenue,
general and administrative expenses increased from 3.8% in the second quarter
of 2000 to 4.5% in the same period in 2001.  There was not a proportionate
decrease in general and administrative costs in relation to the decrease in
revenue.

     Gain on Sale of Operating Assets.  Net gains on the disposition of
property, plant and equipment and other assets for the second quarter of 2001
increased $1 million to $7 million when compared to the same period in 2000.

     Investment Income and Equity Earnings.  Investment income and equity
earnings remained the same for the second quarter of 2001 when compared to
the same period in 2000.

     Other, net.   Other income is comprised primarily of mine management fee
income from Level 3.

     During the second quarter 2001 and 2000, the Company managed two and
three active coal mines, respectively, for Level 3.  Fees for these services
for the second quarter 2001 were $1 million as compared to $8 million for the
same period in 2000.  The decrease is primarily due to a combination of the
expiration of a significant long-term contract in 2000 and the Company's
September 26, 2000 acquisition of Walnut Creek Mining Company, a mine
previously managed for Level 3.  The Company's fee is a percentage of
adjusted operating earnings of the coal mines, as defined in the mine
management agreement with Level 3.  The mines managed by the Company for
Level 3 earn the majority of their revenues under long-term contracts.  The
remainder of the mines' sales are made on the spot market where prices are
substantially lower than those of the long-term contracts.

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                        PETER KIEWIT SONS', INC.


     The U.S. Minerals Management Service has issued an assessment to the
Level 3 mines for the underpayment of royalties.  Level 3 is vigorously
contesting the U.S. Minerals Management Service assessment.  If Level 3 is
ultimately required to pay the U.S. Minerals Management Service approximately
$20.7 million ($13.2 million of which is principal and $7.5 million of which
is interest) the payment would decrease future mine management fees in total
by as much as $4.0 million, but will not affect fees previously received.

     Provision for income taxes.  The effective income tax rate during the
second quarter of 2001 and 2000 was 40%.  This rate differs from the federal
statutory rate of 35% primarily due to state income taxes.


             Results of Operations - Six Months 2001 vs. Six Months 2000

     Revenue.  Revenue for the first six months of 2001 decreased $235
million or 10.8% from the same time period in 2000.  The most significant
factor contributing to this decrease was the reduced work performed on a
large fiber optic project as the work on the project progressed towards
completion.

     Margin.  Margins, as a percentage of revenue, for the first six months
of 2001 decreased to 6.2% compared to 6.4% for the same period in 2000.
Margins may vary between periods due to the inherent uncertainties associated
with fixed price contracts, as well as seasonality and the stage of
completion of individual projects.

     General and Administrative Expenses.  General and administrative
expenses for the first six months of 2001 increased $4 million to $92 million
when compared to the same period in 2000.  The increase was attributed
primarily to increased costs associated with pursuing new work in 2001.  As a
percentage of revenue, general and administrative expenses increased from
4.0% in the first six months of 2000 to 4.7% in the same period in 2001.
There was not a proportionate decrease in general and administrative
costs in relation to the decrease in revenue.

     Gain on Sale of Operating Assets.  Net gains on the disposition of
property, plant and equipment and other assets for the first six months of
2001 increased $1 million to $11 million when compared to the same period in
2000.

     Investment Income and Equity Earnings.  Investment income and equity
earnings for the first six months of 2001 decreased $1 million or 10.0% from
the same period in 2000.  The decrease was primarily attributed to a decrease
in equity earnings.

     Other, net.   Other income is comprised primarily of mine management fee
income from Level 3.

     During the first six months 2001 and 2000, the Company managed two and
three active coal mines, respectively, for Level 3.  Fees for these services
for the first six months of 2001 were $3 million as compared to $16 million
for the same period in 2000.  The decrease is primarily due to a combination
of the expiration of a significant long-term contract in 2000 and the
Company's September 26, 2000 acquisition of Walnut Creek Mining Company, a
mine previously managed for Level 3.  The Company's fee is a percentage of
adjusted operating earnings of the coal mines, as defined in the mine
management agreement with Level 3.  The mines managed by the Company for
Level 3 earn the majority of their revenues under long-term contracts.  The
remainder of the mines' sales are made on the spot market where prices are
substantially lower than those of the long-term contracts.

     The U.S. Minerals Management Service has issued an assessment to the
Level 3 mines for the underpayment of royalties.  Level 3 is vigorously
contesting the U.S. Minerals Management Service assessment.  If Level 3 is
ultimately required to pay the U.S. Minerals Management Service approximately
$20.7 million ($13.2 million of which is principal and $7.5 million of which
is interest) the payment would decrease future mine management fees in total
by as much as $4.0 million, but will not affect fees previously received.

     Provision for income taxes.  The effective income tax rate during
the first six months of 2001 and 2000 was 40%.  This rate differs from the
federal statutory rate of 35% primarily due to state income taxes.

                                        12
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                        PETER KIEWIT SONS', INC.

                Financial Condition - June 30, 2001 vs. December 30, 2000

     Cash and cash equivalents decreased $39 million to $263 million at June
30, 2001 from $302 million at December 30, 2000.  The decrease reflects net
cash provided by operations of $55 million, net cash used in investing
activities of $55 million and $39 million used in financing activities.

     Net cash provided by operating activities for the first six months of
2001 of $55 million represented a decrease of $50 million from the same
period in 2000.  The decrease was due to a net income decrease of $32 million
for the first six months of 2001 compared to the same period in 2000 and
increased working capital requirements for construction contracts.  Cash
provided or used by operating activities is affected to a large degree by the
mix, timing, stage of completion and terms of individual contracts which are
reflected in changes through current assets and liabilities.

     Net cash used in investing activities for the first six months of
2001 decreased by $17 million to $55 million as compared to the same period
in 2000.  This decrease was due to decreases in investments and acquisitions
of $17 million, a decline in additions to notes receivable of $3 million, a
decrease in purchases of marketable securities of $2 million and increases in
proceeds from the sale of property, plant and equipment in the ordinary
course of business of $1 million.  These changes were partially offset by a
decrease in proceeds from sales and maturities of marketable securities of $5
million and a $1 million decline in payments received on notes receivable.

          Net cash used in financing activities for the first six months of
2001 decreased by $44 million to $39 million as compared to the same time
period in 2000.  This decrease was due to issuance of common stock of $27
million, a decrease in repurchases of common stock of $16 million and a
decrease in long-term debt payments of $2 million.  These changes were
partially offset by an increase in dividends paid of $1 million.

     The Company continues to explore opportunities to acquire additional
businesses and anticipates investing between $50 and $100 million annually to
expand its operations.  Other long-term liquidity uses include the payment of
income taxes and the payment of dividends.  As of June 30, 2001, the Company
had no material firm binding purchase commitments related to its investments
other than meeting the normal course of business needs of its construction
joint ventures.  The current portion of long-term debt is $1 million.  The
Company paid dividends during the first six months of 2001 and 2000 of $19
million and $18 million, respectively.  These amounts were determined by the
Board of Directors and were paid in January and May of each such year.  The
Company also has the commitment to repurchase stock at any time during the
year from shareholders.

     The Company does not believe that the spin-off of its Materials Business
as had and is not expected to have an adverse impact on its liquidity or
material commitments, since earnings generated from the Materials Business
had historically been reinvested in the Materials Business.  The Company's
current financial condition, together with anticipated cash flows from
operations, should be sufficient for immediate cash requirements and future
investing activities.  The Company does not presently have any committed bank
credit facilities.  In the past, the Company has been able to borrow on terms
satisfactory to it.  The Company believes that, to the extent necessary, it
will likewise be able to borrow funds on acceptable terms for the foreseeable
future.

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     Recent Accounting Pronouncements.  The Company adopted Statement of
Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which establishes accounting and
reporting standards for derivative instruments and for hedging activities,
effective January 1, 2001.  Adoption of this statement did not materially
affect the Company's financial statements as the Company has no significant
derivative instruments or hedging activities.

     In July 2001, the Financial Accounting Standards Board ("FASB") issued
Statements of Financial Accounting Standards No. 141 (SFAS 141), "Business
Combinations", and No. 142 (FAS 142), "Goodwill and Other Intangible
Assets".

     SFAS 141 supersedes Accounting Principles Board Opinion No. 16 (APB 16),
"Business Combinations".  The most significant changes made by SFAS 141 are:
(1) requiring that the purchase method of accounting be used for all business
combinations initiated after June 30, 2001, (2) establishing specific
criteria for the recognition of intangible assets separately from goodwill,
and (3) requiring unallocated negative goodwill to be written off immediately
as an extraordinary gain (instead of being deferred and amortized).

     SFAS 142 supersedes APB 17, "Intangible Assets".  SFAS 142 primarily
addresses the accounting for goodwill and intangible assets subsequent to
their acquisition (i.e., the post-acquisition accounting).  The provisions of
SFAS 142 will be effective for fiscal years beginning after December 15,
2001.  The most significant changes made by SFAS 142 are: (1) goodwill and
indefinite-lived intangible assets will no longer be amortized, (2) goodwill
will be tested for impairment at least annually at the reporting unit level,
(3) intangible assets deemed to have an indefinite life will be tested for
impairment at least annually, and (4) the amortization period of intangible
assets with finite lives will no longer be limited to forty years.

     We have not yet determined the effect SFAS No. 141 and 142 will have on
our consolidated financial position or results of operations.


Item 3.  Quantitative and Qualitative Disclosure about Market Risk.

     The Company does not believe that its business is subject to significant
market risks arising from interest rates, foreign exchange rates or equity
prices.


                       PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

     There have been no material changes in the legal proceedings reported in
the Company's previously filed Quarterly Report on Form 10-Q for the quarter
ended March 31, 2001.


                                         14
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Item 4.  Submission of Matters to a Vote of Security Holders.

     The Company's annual meeting of stockholders was held on June 16, 2001.
The holders of 28,871,874 of the 29,672,854 outstanding shares of $0.01 par
value common stock ("Common Stock") were present in person or by proxy at
the annual meeting.  At such meeting, the following slate of nominees for
director was proposed by the incumbent directors.  No additional nominations
were received and all of the nominees proposed by the board were elected to
serve one-year terms.


              Director Nominee      Votes For     Withheld
              ----------------      ---------     --------

              Mogens C. Bay         28,132,670     739,204
              Roy L. Cline          28,751,846     120,028
              Richard W. Colf       28,862,674       9,200
              James Q. Crowe        28,071,098     800,776
              Richard Geary         28,859,174      12,700
              Bruce E. Grewcock     28,862,674       9,200
              William L. Grewcock   28,852,170      19,704
              Allan K. Kirkwood     28,862,674       9,200
              Michael R. McCarthy   28,095,490     776,384
              Douglas E. Patterson  28,807,918      63,956
              Walter Scott, Jr.     28,862,674       9,200
              Kenneth E. Stinson    28,862,674       9,200
              George B. Toll, Jr.   28,615,138     256,736

Item 6.  Exhibits and Reports on Form 8-K.

    (a)  Exhibits required by Item 601 of Regulation S-K.

     None.

    (b)  Reports on Form 8-K.

    No reports on Form 8-K have been filed during the quarter for which this
report is filed.


                                       SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                      PETER KIEWIT SONS', INC.






Date: August 13, 2001                /s/  Michael J. Piechoski
                                     ------------------------------
                                     Michael J. Piechoski
                                     Vice President and Principal
                                     Financial Officer



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