Flowserve Corp 8-K, filed Oct 28, 2026
Flowserve Corp (FLS)
About this 8-K
Flowserve Corp filed this 8-K on October 28, 2026.
Flowserve Corporation reported Q3 bookings of $1.38 billion, adjusted EPS of $1.07 and adjusted operating margin of 16.5%, while lowering 2026 organic sales guidance to down 2.5% to down 1.5% and raising adjusted EPS guidance to $4.10 to $4.20. AI summary
Items reported
- Item 2.02: Financial results
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact Name of Registrant as Specified in its Charter)
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| (Address of Principal Executive Offices) | (Zip Code) |
(Registrant’s telephone number, including area code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
On October 28, 2026, Flowserve Corporation, a New York corporation (the “Company”), issued a press release announcing financial results for the third quarter ended September 30, 2026. A copy of this press release is attached as Exhibit 99.1 and incorporated herein by reference.
The information furnished in Item 2.02 of this Form 8-K and in Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that section and shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.
| Item 7.01 | Regulation FD Disclosure. |
On October 29, 2026, the Company will make a presentation about its financial and operating results for the third quarter of 2026, as noted in the press release described in Item 2.02 above. The Company has posted the presentation on its website at http://www.flowserve.com under the “Investors” section.
The information furnished in Item 7.01 of this Form 8-K and in Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that section and shall not be deemed incorporated by reference into any filing under the Securities Act, or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit |
Description | |
| 99.1 | Press Release, dated October 28, 2026. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL Document). | |
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 hereunto duly authorized.
| FLOWSERVE CORPORATION | ||||||
| Dated: October 28, 2026 | By: | /s/ Brian Ezzell | ||||
| Brian Ezzell | ||||||
| Senior Vice President, Chief Financial Officer and | ||||||
| Interim Chief Accounting Officer | ||||||
EXHIBIT 99.1
Flowserve Corporation Reports Third Quarter 2026 Results
Flowserve Business System Delivers Strong Q3 Performance; Updates 2026 Guidance
DALLAS, October 28, 2026 – Flowserve Corporation (NYSE: FLS), a leading provider of flow control products and services for the global infrastructure markets, reported its financial results for the third quarter ended September 30, 2026.
Highlights:
| • | Bookings of $1.38 billion, up 14% on a reported basis and 8% organically versus the prior-year period |
| • | Record aftermarket bookings of $728 million |
| • | Operating margin of 12.5% expanded 580 basis points and adjusted1 operating margin2 of 16.5% expanded 170 basis points compared to the prior-year period |
| • | Reported EPS of $0.81 and adjusted EPS3 of $1.07 |
| • | Raised the low end of full-year 2026 adjusted EPS3 guidance to $4.10 to $4.20 |
| • | Revised full-year 2026 organic sales guidance to down 2.5% to down 1.5% reflecting increasingly challenging conditions in the Middle East |
| • | Backlog of $3.5 billion, up 20% year over year, the largest backlog in Flowserve’s history |
Management Commentary:
“Our teams delivered another quarter of meaningful bookings growth, adjusted operating margin expansion, and higher adjusted earnings per share while navigating ongoing Middle East disruption,” said Scott Rowe, Flowserve’s President and Chief Executive Officer. “The Flowserve Business System is helping us translate solid market demand into bookings growth and stronger profitability, with a clear focus on growth, execution, and customer service. The resilience and commitment of our associates around the globe remain instrumental in our ability to deliver for our customers and shareholders.”
“With three quarters behind us, our year-to-date earnings performance and continued margin expansion support raising the low end of our adjusted EPS guidance range. At the same time, we are lowering our full-year sales growth outlook to reflect more challenging operating conditions in the Middle East, which are delaying customer activity and revenue conversion and are expected to impact fourth-quarter sales. Significant growth in our backlog, alongside healthy underlying demand across our end markets, reinforces our confidence in delivering mid-single digit organic sales CAGR through 2030, while continued operational progress supports our broader long-term financial targets. We remain focused on converting our growing backlog to sales, further reducing complexity in our operations, and continuing to deliver margin expansion to create shareholder value.”
Key Figures (unaudited):
| (dollars in millions, except per share) |
Q3 2026 | Q3 2025 | Change | YTD 2026 | YTD 2025 | Change | ||||||||||||||||||
| Organic Bookings |
7.7 | % | 6.1 | % | ||||||||||||||||||||
| Acquisitions/Divestitures Impact |
660 bps | 270 bps | ||||||||||||||||||||||
| Foreign Exchange Impact |
(20 bps | ) | 150 bps | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total Bookings |
$ | 1,383.5 | $ | 1,213.0 | 14.1 | % | $ | 3,872.5 | $ | 3,511.2 | 10.3 | % | ||||||||||||
| Original Equipment Bookings |
$ | 655.8 | $ | 559.9 | 17.1 | % | $ | 1,768.6 | $ | 1,549.0 | 14.2 | % | ||||||||||||
| Aftermarket Bookings |
$ | 727.7 | $ | 653.1 | 11.4 | % | $ | 2,103.9 | $ | 1,962.2 | 7.2 | % | ||||||||||||
| Organic Sales4 |
(1.2 | %) | (4.9 | %) | ||||||||||||||||||||
| Acquisitions/Divestitures Impact |
670 bps | 260 bps | ||||||||||||||||||||||
| Foreign Exchange Impact |
(10 bps | ) | 140 bps | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Reported Sales |
$ | 1,237.8 | $ | 1,174.4 | 5.4 | % | $ | 3,475.2 | $ | 3,507.1 | (0.9 | %) | ||||||||||||
| Operating Margin |
12.5 | % | 6.7 | % | 580 bps | 12.2 | % | 10.2 | % | 200 bps | ||||||||||||||
| Adjusted Operating Margin |
16.5 | % | 14.8 | % | 170 bps | 15.6 | % | 14.1 | % | 150 bps | ||||||||||||||
| Earnings Per Share (EPS) |
$ | 0.81 | $ | 1.67 | (51.5 | %) | $ | 2.21 | $ | 2.85 | (22.5 | %) | ||||||||||||
| Adjusted Earnings Per Share (EPS) |
$ | 1.07 | $ | 0.90 | 18.9 | % | $ | 2.87 | $ | 2.53 | 13.4 | % | ||||||||||||
| Cash From Operations |
$ | 144.1 | $ | 401.8 | ($ | 257.7 | ) | $ | 230.3 | $ | 506.1 | ($ | 275.8 | ) | ||||||||||
| Backlog |
$ | 3,471.8 | $ | 2,896.1 | 19.9 | % | $ | 3,471.8 | $ | 2,896.1 | 19.9 | % | ||||||||||||
2026 Guidance3:
The Company updated 2026 guidance:
| Prior | Current | |||
| Organic Sales Growth |
Approx. (1%) | (2.5%) to (1.5%) | ||
| Impact From Acquisitions/Divestitures |
Approx. +300 bps | Approx. +350 bps | ||
| Impact From Foreign Exchange Translation |
Approx. +100 bps | Approx. +100 bps | ||
| Total Sales Growth |
Approx. +3% | +2% to +3% | ||
| Adjusted EPS |
$4.05 to $4.20 | $4.10 to $4.20 | ||
| Net Interest Expense |
Approx. $85 million | Approx. $85 million | ||
| Adjusted Tax Rate |
21% to 22% | 21% to 22% | ||
| Capital Expenditures |
Approx. $100 million | Approx. $90 million |
2
The guidance assumes tariff rates in place as of October 1, 2026, and assumes increasingly challenging conditions in the Middle East, which have been impacted by armed conflict and geopolitical instability.
Webcast and Conference Call Instructions:
Flowserve will host its conference call to discuss third quarter results on Thursday, October 29, 2026, at 8:30 a.m. Eastern Time. The call can be accessed by shareholders and other interested parties on Flowserve’s Investor Relations website.
Upcoming Investor Conferences:
Flowserve announced its participation in the following upcoming investor conferences:
| • | On Wednesday, November 11, 2026, Scott Rowe and Brian Ezzell, Senior Vice President and Chief Financial Officer, will participate in investor meetings at the Baird Global Industrial Conference. Additionally, Scott Rowe will participate in a fireside chat that will begin at 1:10 p.m. Central Time (2:10 p.m. Eastern Time). |
| • | On Wednesday, December 2, 2026, Brian Ezzell will participate in investor meetings as well as a fireside chat at the Goldman Sachs Industrials and Materials Conference that will begin at 11:30 a.m. Eastern Time. |
Shareholders and other interested parties can access the live webcasts of the fireside chats on Flowserve’s Investor Relations website. Replays of the webcasts will be available after the events.
Footnotes
| 1 | See Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (unaudited) and Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (unaudited) tables for a detailed reconciliation of reported results to adjusted measures. |
| 2 | Adjusted operating margin is calculated by dividing adjusted operating income by sales. Adjusted operating income is derived by excluding the adjusted items. |
| 3 | Adjusted earnings per share (EPS) excludes realignment expenses, the impact from other specific discrete and below-the-line foreign currency effects and utilizes the then-applicable foreign exchange rates and fully diluted shares. Adjusted full-year 2026 EPS guidance excludes certain other discrete items which may arise during the year. |
| 4 | Organic is defined as the change in sales, as defined by U.S. GAAP, excluding the impacts of currency translation and acquisitions and divestitures. The impact of currency translation is calculated by translating current year results on a monthly basis at prior year exchange rates for the same period. |
3
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
| Three Months Ended September 30, | ||||||||
| (Amounts in thousands) | 2026 | 2025 | ||||||
| Sales |
$ | 1,237,773 | $ | 1,174,434 | ||||
| Cost of sales |
(823,393 | ) | (794,148 | ) | ||||
|
|
|
|
|
|||||
| Gross profit |
414,380 | 380,286 | ||||||
| Selling, general and administrative expense |
(281,937 | ) | (305,152 | ) | ||||
| Gain on sale of business |
16,177 | — | ||||||
| Net earnings from affiliates |
5,986 | 4,138 | ||||||
|
|
|
|
|
|||||
| Operating income |
154,606 | 79,272 | ||||||
| Interest expense |
(26,641 | ) | (18,738 | ) | ||||
| Interest income |
2,362 | 792 | ||||||
| Other (expense) income, net |
(8,184 | ) | 256,220 | |||||
|
|
|
|
|
|||||
| Earnings before income taxes |
122,143 | 317,546 | ||||||
| (Provision for) benefit from income taxes |
(15,090 | ) | (93,688 | ) | ||||
|
|
|
|
|
|||||
| Net earnings, including noncontrolling interests |
107,053 | 223,858 | ||||||
| Less: net earnings attributable to noncontrolling interests |
(4,015 | ) | (4,276 | ) | ||||
|
|
|
|
|
|||||
| Net earnings attributable to Flowserve Corporation |
$ | 103,038 | $ | 219,582 | ||||
|
|
|
|
|
|||||
| Net earnings per share attributable to Flowserve Corporation common shareholders: |
||||||||
| Basic |
$ | 0.81 | $ | 1.69 | ||||
| Diluted |
0.81 | 1.67 | ||||||
| Weighted average shares - basic |
127,164 | 130,315 | ||||||
| Weighted average shares - diluted |
127,962 | 131,235 | ||||||
4
Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited)
(Amounts in thousands, except per share data)
|
Three Months Ended September 30, 2026 |
Gross Profit |
Selling, General & Administrative Expense |
Gain on Sale of Business |
Operating Income |
Other Income (Expense), Net |
Provision For (Benefit From) Income Taxes |
Net Earnings (Loss) |
Effective Tax Rate |
Diluted EPS |
|||||||||||||||||||||||||||
| Reported |
$ | 414,380 | $ | 281,937 | $ | 16,177 | $ | 154,606 | $ | (8,184 | ) | $ | 15,090 | $ | 103,038 | 12.4 | % | 0.81 | ||||||||||||||||||
| Reported as a percent of sales |
33.5 | % | 22.8 | % | 1.3 | % | 12.5 | % | -0.7 | % | 1.2 | % | 8.3 | % | ||||||||||||||||||||||
| Realignment charges (a) |
25,971 | (6,018 | ) | (16,177 | ) | 15,812 | — | (6,260 | ) | 22,072 | -39.6 | % | 0.17 | |||||||||||||||||||||||
| Acquisition and divestiture related (b) |
— | (5,275 | ) | — | 5,275 | — | 1,241 | 4,034 | 23.5 | % | 0.03 | |||||||||||||||||||||||||
| Amortization of intangible assets (c) |
13,898 | (6,765 | ) | — | 20,663 | — | 2,874 | 17,789 | 13.9 | % | 0.14 | |||||||||||||||||||||||||
| Discrete items (d) |
— | (7,830 | ) | — | 7,830 | 1,000 | 190 | 8,640 | 2.2 | % | 0.07 | |||||||||||||||||||||||||
| Discrete tax items (e) |
— | — | — | — | — | 23,072 | (23,072 | ) | 0.0 | % | (0.18 | ) | ||||||||||||||||||||||||
| Below-the-line foreign exchange impacts (f) |
— | — | — | — | 5,132 | 442 | 4,690 | 8.6 | % | 0.04 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Adjusted |
$ | 454,249 | $ | 256,049 | $ | — | $ | 204,186 | $ | (2,052 | ) | $ | 36,649 | $ | 137,191 | 20.6 | % | 1.07 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Adjusted as a percent of sales |
36.7 | % | 20.7 | % | 0.0 | % | 16.5 | % | -0.2 | % | 3.0 | % | 11.1 | % | ||||||||||||||||||||||
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs and includes the gain on divestiture of our PMV Automation business (PMV) within FCD. |
| (b) | Charges represent costs associated with strategic acquisition and divestiture activities including the acquisitions of Trillium Valves and Flowserve Al Mansoori Services Company (FAMCO), and the divestiture of PMV. |
| (c) | Charges represent non-cash amortization of intangible assets and step-up in value of acquired inventories. |
| (d) | Charge represents the $7,972 strategic acquisition of intellectual property within FPD, an immaterial adjustment to transaction costs related to the divestiture of our asbestos-related assets and liabilities that were adjusted out in a prior period and $1,000 for non-cash pension settlement accounting losses incurred in conjunction with the U.S. pension plan. |
| (e) | Discrete tax adjustment includes the impact from the release of a valuation allowance in Italy. |
| (f) | Below-the-line foreign exchange impacts represent the remeasurement of foreign exchange derivative contracts as well as the remeasurement of assets and liabilities that are denominated in a currency other than a site’s respective functional currency and includes the foreign exchange loss on the Blue Chip Swap Securities transaction. |
|
Three Months Ended September 30, 2025 |
Gross Profit |
Selling, General & Administrative Expense |
Operating Income |
Other Income (Expense), Net |
Provision For (Benefit From) Income Taxes |
Net Earnings (Loss) |
Effective Tax Rate |
Diluted EPS |
||||||||||||||||||||||||
| Reported |
$ | 380,286 | $ | 305,152 | $ | 79,272 | $ | 256,220 | $ | 93,688 | $ | 219,582 | 29.5 | % | 1.67 | |||||||||||||||||
| Reported as a percent of sales |
32.4 | % | 26.0 | % | 6.7 | % | 21.8 | % | 8.0 | % | 18.7 | % | ||||||||||||||||||||
| Realignment charges (a) |
25,481 | (4,571 | ) | 30,052 | — | 6,907 | 23,145 | 23.0 | % | 0.18 | ||||||||||||||||||||||
| Acquisition related (b) |
9 | (4,243 | ) | 4,252 | — | 1,000 | 3,252 | 23.5 | % | 0.02 | ||||||||||||||||||||||
| Purchase accounting step-up and intangible asset amortization (c) |
2,625 | (1,300 | ) | 3,925 | — | 1,182 | 2,743 | 30.1 | % | 0.02 | ||||||||||||||||||||||
| Discrete items (d)(e)(f) |
31 | (30,351 | ) | 30,382 | 1,500 | 7,499 | 24,383 | 23.5 | % | 0.19 | ||||||||||||||||||||||
| Merger transaction costs (g) |
— | (25,682 | ) | 25,682 | — | 5,885 | 19,797 | 22.9 | % | 0.15 | ||||||||||||||||||||||
| Merger termination payment (h) |
— | — | — | (266,000 | ) | (60,957 | ) | (205,043 | ) | 22.9 | % | (1.56 | ) | |||||||||||||||||||
| Discrete tax items (i) |
— | — | — | — | (24,860 | ) | 24,860 | 0.0 | % | 0.19 | ||||||||||||||||||||||
| Below-the-line foreign exchange impacts (j) |
— | — | — | 5,401 | 622 | 4,779 | 11.5 | % | 0.04 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Adjusted |
$ | 408,432 | $ | 239,005 | $ | 173,565 | $ | (2,879 | ) | $ | 30,966 | $ | 117,498 | 20.3 | % | 0.90 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Adjusted as a percent of sales |
34.8 | % | 20.4 | % | 14.8 | % | -0.2 | % | 2.6 | % | 10.0 | % | ||||||||||||||||||||
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $2,300 is non-cash. |
| (b) | Charge represents acquisition and integration related costs associated with the MOGAS acquisition. |
| (c) | Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition. |
| (d) | Charge represents non-cash share-based compensation expense associated with a one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our U.S. Qualified pension plan. |
| (e) | Charge of $1,500 represents a non-cash pension settlement accounting loss incurred in conjunction with the freeze of our U.S. Qualified pension plan. |
| (f) | Charge of $30,100 represents the Q3 2025 non-cash adjustment to our estimated liability for incurred by not reported asbestos claims based on an annual actuarial study. |
| (g) | Charge represents transaction costs incurred associated with the terminated Chart Industries merger. |
| (h) | Amount represents the Chart Industries merger termination fee paid to Flowserve. |
| (i) | Amount represents a one-time tax charge related to enactment of the One Big Beautiful Bill Act during Q3 2025. |
| (j) | Below-the-line foreign exchange impacts represent the remeasurement of foreign exchange derivative contracts as well as the remeasurement of assets and liabilities that are denominated in a currency other than a site’s respective functional currency. |
5
SEGMENT INFORMATION
(Unaudited)
| Three Months Ended September 30, | ||||||||
| FLOWSERVE PUMPS DIVISION | 2026 | 2025 | ||||||
| (Amounts in millions, except percentages) | ||||||||
| Bookings |
$ | 940.1 | $ | 819.5 | ||||
| Sales |
830.4 | 800.3 | ||||||
| Gross profit |
314.3 | 265.8 | ||||||
| Gross profit margin |
37.8 | % | 33.2 | % | ||||
| SG&A |
152.2 | 135.0 | ||||||
| Segment operating income |
168.0 | 134.9 | ||||||
| Segment operating income as a percentage of sales |
20.2 | % | 16.9 | % | ||||
| Three Months Ended September 30, | ||||||||
| FLOW CONTROL DIVISION | 2026 | 2025 | ||||||
| (Amounts in millions, except percentages) | ||||||||
| Bookings |
$ | 446.2 | $ | 396.1 | ||||
| Sales |
411.6 | 377.4 | ||||||
| Gross profit |
98.9 | 114.2 | ||||||
| Gross profit margin |
24.0 | % | 30.3 | % | ||||
| SG&A |
80.9 | 67.8 | ||||||
| Gain on sale of business |
16.2 | — | ||||||
| Segment operating income |
34.2 | 46.4 | ||||||
| Segment operating income as a percentage of sales |
8.3 | % | 12.3 | % | ||||
6
Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited)
(Amounts in thousands)
Flowserve Pumps Division
| Three Months Ended September 30, 2026 |
Gross Profit |
Selling, General & Administrative Expense |
Operating Income |
|||||||||
| Reported |
$ | 314,255 | $ | 152,218 | $ | 168,023 | ||||||
| Reported as a percent of sales |
37.8 | % | 18.3 | % | 20.2 | % | ||||||
| Realignment charges (a) |
(869 | ) | (534 | ) | (335 | ) | ||||||
| Discrete items (b) |
— | (7,967 | ) | 7,967 | ||||||||
| Amortization of intangible assets (d) |
2,916 | (2,276 | ) | 5,192 | ||||||||
|
|
|
|
|
|
|
|||||||
| Adjusted |
$ | 316,302 | $ | 141,441 | $ | 180,847 | ||||||
|
|
|
|
|
|
|
|||||||
| Adjusted as a percent of sales |
38.1 | % | 17.0 | % | 21.8 | % | ||||||
| Three Months Ended |
Gross Profit |
Selling, General & Administrative Expense |
Operating Income |
|||||||||
| Reported |
$ | 265,776 | $ | 135,046 | $ | 134,869 | ||||||
| Reported as a percent of sales |
33.2 | % | 16.9 | % | 16.9 | % | ||||||
| Realignment charges (a) |
21,628 | (88 | ) | 21,716 | ||||||||
| Discrete items (b) |
24 | (63 | ) | 87 | ||||||||
|
|
|
|
|
|
|
|||||||
| Adjusted |
$ | 287,428 | $ | 134,895 | $ | 156,672 | ||||||
|
|
|
|
|
|
|
|||||||
| Adjusted as a percent of sales |
35.9 | % | 16.9 | % | 19.6 | % | ||||||
Flow Control Division
|
Three Months Ended |
Gross Profit |
Selling, General & Administrative Expense |
Gain on Sale of Business |
Operating Income |
||||||||||||
| Reported |
$ | 98,906 | $ | 80,889 | $ | 16,177 | $ | 34,194 | ||||||||
| Reported as a percent of sales |
24.0 | % | 19.7 | % | 3.9 | % | 8.3 | % | ||||||||
| Realignment charges (a) |
26,840 | (3,762 | ) | (16,177 | ) | 14,425 | ||||||||||
| Acquisition and divestiture related (c) |
— | (2,956 | ) | — | 2,956 | |||||||||||
| Amortization of intangible assets (d) |
10,982 | (4,489 | ) | — | 15,471 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted |
$ | 136,728 | $ | 69,682 | $ | — | $ | 67,046 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted as a percent of sales |
33.2 | % | 16.9 | % | 0.0 | % | 16.3 | % | ||||||||
| Three Months Ended |
Gross Profit |
Selling, General & Administrative Expense |
Operating Income |
|||||||||
| Reported |
$ | 114,250 | $ | 67,810 | $ | 46,440 | ||||||
| Reported as a percent of sales |
30.3 | % | 18.0 | % | 12.3 | % | ||||||
| Realignment charges (a) |
4,386 | (2,395 | ) | 6,781 | ||||||||
| Acquisition related (c) |
9 | (4,243 | ) | 4,252 | ||||||||
| Purchase accounting step-up and intangible asset amortization (d) |
2,625 | (1,300 | ) | 3,925 | ||||||||
| Discrete items (b) |
5 | (45 | ) | 50 | ||||||||
|
|
|
|
|
|
|
|||||||
| Adjusted |
$ | 121,275 | $ | 59,827 | $ | 61,448 | ||||||
|
|
|
|
|
|
|
|||||||
| Adjusted as a percent of sales |
32.1 | % | 15.9 | % | 16.3 | % | ||||||
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs and includes the gain on divestiture of our PMV Automation business (PMV) within FCD. |
| (b) | Charge represents the $7,967 strategic acquisition of intellectual property within FPD. |
| (c) | Charges represent costs associated with strategic acquisition and divestiture activities including the acquisitions of Trillium Valves and the divestiture of PMV with FCD. |
| (d) | Charges represent non-cash amortization of intangible assets and step-up in value of acquired inventories. |
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $2,300 is non-cash. |
| (b) | Charge represents non-cash share-based compensation expense associated with a one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our U.S. Qualified pension plan. |
| (c) | Charge represents acquisition and integration-related costs associated with the MOGAS acquisition. |
| (d) | Charge represents amortization of acquisition related intangible assets associated with the MOGAS acquisition. |
7
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Amounts in thousands, except per share data)
| Nine Months Ended September 30, | ||||||||
| 2026 | 2025 | |||||||
| Sales |
$ | 3,475,217 | $ | 3,507,069 | ||||
| Cost of sales |
(2,296,270 | ) | (2,350,867 | ) | ||||
|
|
|
|
|
|||||
| Gross profit |
1,178,947 | 1,156,202 | ||||||
| Selling, general and administrative expense |
(811,655 | ) | (814,237 | ) | ||||
| Gain on sale of business |
16,177 | — | ||||||
| Net earnings from affiliates |
41,992 | 15,786 | ||||||
|
|
|
|
|
|||||
| Operating income |
425,461 | 357,751 | ||||||
| Interest expense |
(72,768 | ) | (58,166 | ) | ||||
| Interest income |
8,885 | 5,063 | ||||||
| Other (expense) income, net |
(13,272 | ) | 213,958 | |||||
|
|
|
|
|
|||||
| Earnings before income taxes |
348,306 | 518,606 | ||||||
| Provision for income taxes |
(53,299 | ) | (127,067 | ) | ||||
|
|
|
|
|
|||||
| Net earnings, including noncontrolling interests |
295,007 | 391,539 | ||||||
| Less: Net earnings attributable to noncontrolling interests |
(11,290 | ) | (16,298 | ) | ||||
|
|
|
|
|
|||||
| Net earnings attributable to Flowserve Corporation |
$ | 283,717 | $ | 375,241 | ||||
|
|
|
|
|
|||||
| Net earnings per share attributable to Flowserve Corporation common shareholders: |
||||||||
| Basic |
$ | 2.23 | $ | 2.87 | ||||
| Diluted |
2.21 | 2.85 | ||||||
| Weighted average shares - basic |
127,434 | 130,910 | ||||||
| Weighted average shares - diluted |
128,314 | 131,836 | ||||||
8
Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited)
(Amounts in thousands, except per share data)
| Nine Months Ended September 30, 2026 |
Gross Profit |
Selling, General & Administrative Expense |
Gain on Sale of Business |
Net earnings from affiliates |
Operating Income |
Other Income (Expense), Net |
Provision For (Benefit From) Income Taxes |
Net Earnings (Loss) |
Effective Tax Rate |
Diluted EPS |
||||||||||||||||||||||||||||||
| Reported |
$ | 1,178,947 | $ | 811,655 | $ | 16,177 | $ | 41,992 | $ | 425,461 | $ | (13,272 | ) | $ | 53,299 | $ | 283,717 | 15.3 | % | 2.21 | ||||||||||||||||||||
| Reported as a percent of sales |
33.9 | % | 23.4 | % | 0.5 | % | 1.2 | % | 12.2 | % | -0.4 | % | 1.5 | % | 8.2 | % | ||||||||||||||||||||||||
| Realignment charges (a) |
75,452 | (26,234 | ) | (16,177 | ) | — | 85,509 | — | 6,773 | 78,736 | 7.9 | % | 0.61 | |||||||||||||||||||||||||||
| Acquisition and divestiture related (b)(c) |
— | (23,179 | ) | — | (27,700 | ) | (4,521 | ) | — | 5,554 | (10,075 | ) | -122.8 | % | (0.08 | ) | ||||||||||||||||||||||||
| Amortization of intangible assets (d) |
16,454 | (12,113 | ) | — | — | 28,567 | — | 4,394 | 24,173 | 15.4 | % | 0.19 | ||||||||||||||||||||||||||||
| Discrete items (e)(f) |
62 | (8,719 | ) | — | — | 8,781 | 5,576 | 1,491 | 12,866 | 10.4 | % | 0.10 | ||||||||||||||||||||||||||||
| Discrete tax items (g) |
— | — | — | — | — | — | 23,072 | (23,072 | ) | 0.0 | % | (0.18 | ) | |||||||||||||||||||||||||||
| Below-the-line foreign exchange impacts (h) |
— | — | — | — | — | 2,409 | 255 | 2,154 | 10.6 | % | 0.02 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
| Adjusted |
$ | 1,270,915 | $ | 741,410 | $ | — | $ | 14,292 | $ | 543,797 | $ | (5,287 | ) | $ | 94,838 | $ | 368,499 | 20.0 | % | 2.87 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
| Adjusted as a percent of sales |
36.6 | % | 21.3 | % | 0.0 | % | 0.4 | % | 15.6 | % | -0.2 | % | 2.7 | % | 10.6 | % | ||||||||||||||||||||||||
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs, net of a $5,300 gain associated with a sale-leaseback transaction related to a FCD facility, and of which $5,234 is non-cash. Also includes the gain on divestiture of our PMV Automation business (PMV) within FCD. |
| (b) | Charges represent costs associated with strategic acquisition and divestiture activities including the acquisitions of Greenray, Trillium Valves and Flowserve Al Mansoori Services Company (FAMCO), and the divestiture of PMV. |
| (c) | Adjustment represents a $27,700 gain recognized in Net earnings from affiliates on the remeasurement of our previously held equity interest in FAMCO. |
| (d) | Charges represent non-cash amortization of intangible assets and step-up in value of acquired inventories. |
| (e) | Charges represent discrete items including $523 of non-cash share-based compensation expense associated with a one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our U.S. Qualified pension plan, $286 of transaction costs related to the divestiture of our asbestos-related assets and liabilities and the $7,972 strategic acquisition of intellectual property within FPD. |
| (f) | Charges include $5,576 for non-cash pension settlement accounting losses incurred in conjunction with pension plans in the United States and Canada. |
| (g) | Discrete tax adjustment includes the impact from the release of a valuation allowance in Italy. |
| (h) | Below-the-line foreign exchange impacts represent the remeasurement of foreign exchange derivative contracts as well as the remeasurement of assets and liabilities that are denominated in a currency other than a site’s respective functional currency and includes the foreign exchange loss on the Blue Chip Swap Securities transaction. |
|
Nine Months Ended September 30, 2025 |
Gross Profit |
Selling, General & Administrative Expense |
Operating Income |
Other Income (Expense), Net |
Provision For (Benefit From) Income Taxes |
Net Earnings (Loss) |
Effective Tax Rate |
Diluted EPS | ||||||||||||||||||||||||
| Reported |
$ | 1,156,202 | $ | 814,237 | $ | 357,751 | $ | 213,958 | $ | 127,067 | $ | 375,241 | 24.5 | % | 2.85 | |||||||||||||||||
| Reported as a percent of sales |
33.0 | % | 23.2 | % | 10.2 | % | 6.1 | % | 3.6 | % | 10.7 | % | ||||||||||||||||||||
| Realignment charges (a) |
40,600 | (1,481 | ) | 42,081 | — | 10,096 | 31,985 | 24.0 | % | 0.24 | ||||||||||||||||||||||
| Acquisition related (b) |
761 | (8,714 | ) | 9,475 | — | 2,228 | 7,247 | 23.5 | % | 0.05 | ||||||||||||||||||||||
| Purchase accounting step-up and intangible asset amortization (c) |
8,742 | (3,900 | ) | 12,642 | — | 3,729 | 8,913 | 29.5 | % | 0.07 | ||||||||||||||||||||||
| Discrete items (d)(e)(f) |
106 | (31,116 | ) | 31,222 | 4,500 | 8,403 | 27,319 | 23.5 | % | 0.21 | ||||||||||||||||||||||
| Merger transaction costs (g) |
— | (41,197 | ) | 41,197 | — | 9,534 | 31,663 | 23.1 | % | 0.24 | ||||||||||||||||||||||
| Merger termination payment (h) |
— | — | — | (266,000 | ) | (60,957 | ) | (205,043 | ) | 22.9 | % | (1.56 | ) | |||||||||||||||||||
| Discrete tax items (i) |
— | — | — | — | (24,860 | ) | 24,860 | 0.0 | % | 0.19 | ||||||||||||||||||||||
| Below-the-line foreign exchange impacts (j) |
— | — | — | 36,797 | 5,977 | 30,820 | 16.2 | % | 0.23 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Adjusted |
$ | 1,206,411 | $ | 727,829 | $ | 494,368 | $ | (10,745 | ) | $ | 81,217 | $ | 333,005 | 18.9 | % | 2.53 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Adjusted as a percent of sales |
34.4 | % | 20.8 | % | 14.1 | % | -0.3 | % | 2.3 | % | 9.5 | % | ||||||||||||||||||||
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $5,300 is non-cash. |
| (b) | Charge represents acquisition and integration related costs associated with the MOGAS acquisition. |
| (c) | Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition. |
| (d) | Charge represents non-cash share-based compensation expense associated with a one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our U.S. Qualified pension plan. |
| (e) | Charge of $4,500 represents a non-cash pension settlement accounting loss incurred in conjunction with the freeze of our U.S. Qualified pension plan. |
| (f) | Charge of $30,100 represents the Q3 2025 non-cash adjustment to our estimated liability for incurred by not reported asbestos claims based on an annual actuarial study. |
| (g) | Charge represents transaction costs incurred associated with the terminated Chart Industries merger. |
| (h) | Amount represents the Chart Industries merger termination fee paid to Flowserve. |
| (i) | Amount represents a one-time tax charge related to enactment of the One Big Beautiful Bill Act during Q3 2025. |
| (j) | Below-the-line foreign exchange impacts represent the remeasurement of foreign exchange derivative contracts as well as the remeasurement of assets and liabilities that are denominated in a currency other than a site’s respective functional currency. |
9
SEGMENT INFORMATION
(Unaudited)
| FLOWSERVE PUMPS DIVISION | Nine Months Ended September 30, | |||||||
| (Amounts in millions, except percentages) | 2026 | 2025 | ||||||
| Bookings |
$ | 2,646.3 | $ | 2,394.8 | ||||
| Sales |
2,389.0 | 2,402.4 | ||||||
| Gross profit |
880.3 | 833.5 | ||||||
| Gross profit margin |
36.8 | % | 34.7 | % | ||||
| SG&A |
447.4 | 415.1 | ||||||
| Segment operating income |
474.9 | 434.1 | ||||||
| Segment operating income as a percentage of sales |
19.9 | % | 18.1 | % | ||||
| FLOW CONTROL DIVISION | Nine Months Ended September 30, | |||||||
| (Amounts in millions, except percentages) | 2026 | 2025 | ||||||
| Bookings |
$ | 1,236.0 | $ | 1,126.1 | ||||
| Sales |
1,096.5 | 1,112.9 | ||||||
| Gross profit |
296.4 | 322.1 | ||||||
| Gross profit margin |
27.0 | % | 28.9 | % | ||||
| SG&A |
225.7 | 206.4 | ||||||
| Gain on sale of business |
16.2 | — | ||||||
| Segment operating income |
86.9 | 115.7 | ||||||
| Segment operating income as a percentage of sales |
7.9 | % | 10.4 | % | ||||
10
Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited)
(Amounts in thousands)
Flowserve Pumps Division
| Nine Months Ended |
Gross Profit | Selling, General & Administrative Expense |
Net earnings from affiliates |
Operating Income |
||||||||||||
| Reported |
$ | 880,323 | $ | 447,390 | $ | 41,992 | $ | 474,925 | ||||||||
| Reported as a percent of sales |
36.8 | % | 18.7 | % | 1.8 | % | 19.9 | % | ||||||||
| Realignment charges (a) |
19,740 | (10,067 | ) | — | 29,807 | |||||||||||
| Discrete |
48 | (8,063 | ) | — | 8,111 | |||||||||||
| Acquisition and divestiture related (d)(e) |
— | (813 | ) | (27,700 | ) | (26,887 | ) | |||||||||
| Amortization of intangible assets (f) |
5,372 | (5,022 | ) | — | 10,394 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted |
$ | 905,483 | $ | 423,425 | $ | 14,292 | $ | 496,350 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted as a percent of sales |
37.9 | % | 17.7 | % | 0.6 | % | 20.8 | % | ||||||||
| Nine Months Ended September 30, 2025 |
Gross Profit | Selling, General & Administrative Expense |
Operating Income |
|||||||||
| Reported |
$ | 833,467 | $ | 415,126 | $ | 434,128 | ||||||
| Reported as a percent of sales |
34.7 | % | 17.3 | % | 18.1 | % | ||||||
| Realignment charges (a) |
26,495 | (840 | ) | 27,335 | ||||||||
| Discrete items (b) |
87 | (287 | ) | 374 | ||||||||
|
|
|
|
|
|
|
|||||||
| Adjusted |
$ | 860,049 | $ | 413,999 | $ | 461,837 | ||||||
|
|
|
|
|
|
|
|||||||
| Adjusted as a percent of sales |
35.8 | % | 17.2 | % | 19.2 | % | ||||||
Flow Control Division
| Nine Months Ended |
Gross Profit | Selling, General & Administrative Expense |
Gain on Sale of Business |
Operating Income |
||||||||||||
| Reported |
$ | 296,399 | $ | 225,648 | $ | 16,177 | $ | 86,928 | ||||||||
| Reported as a percent of sales |
27.0 | % | 20.6 | % | 1.5 | % | 7.9 | % | ||||||||
| Realignment charges (a) |
55,712 | (476 | ) | (16,177 | ) | 40,011 | ||||||||||
| Discrete items (b) |
10 | (75 | ) | — | 85 | |||||||||||
| Acquisition and divestiture related (d) |
— | (19,121 | ) | — | 19,121 | |||||||||||
| Amortization of intangible assets (f) |
11,082 | (7,091 | ) | — | 18,173 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted |
$ | 363,203 | $ | 198,885 | $ | — | $ | 164,318 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted as a percent of sales |
33.1 | % | 18.1 | % | 0.0 | % | 15.0 | % | ||||||||
| Nine Months Ended September 30, 2025 |
Gross Profit | Selling, General & Administrative Expense |
Operating Income |
|||||||||
| Reported |
$ | 322,131 | $ | 206,437 | $ | 115,694 | ||||||
| Reported as a percent of sales |
28.9 | % | 18.5 | % | 10.4 | % | ||||||
| Realignment charges (a) |
14,704 | 1,230 | 13,474 | |||||||||
| Acquisition related (c) |
761 | (8,714 | ) | 9,475 | ||||||||
| Purchase accounting step-up and intangible asset amortization (d) |
8,742 | (3,900 | ) | 12,642 | ||||||||
| Discrete items (b) |
14 | (208 | ) | 222 | ||||||||
|
|
|
|
|
|
|
|||||||
| Adjusted |
$ | 346,352 | $ | 194,845 | $ | 151,507 | ||||||
|
|
|
|
|
|
|
|||||||
| Adjusted as a percent of sales |
31.1 | % | 17.5 | % | 13.6 | % | ||||||
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs, net of a $5,300 gain associated with a sale-leaseback transaction related to a FCD facility, and of which $5,234 is non-cash. Also includes the gain on divestiture of our PMV Automation business (PMV) within FCD. |
| (b) | Charges represent $229 of non-cash share-based compensation expense associated with a one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our U.S. Qualified pension plan. |
| (c) | Charge represents the $7,967 strategic acquisition of intellectual property within FPD. |
| (d) | Charges represent costs associated with strategic acquisition and divestiture activities including the acquisitions of Greenray, Trillium Valves and Flowserve Al Mansoori Services Company (FAMCO), and the divestiture of PMV. |
| (e) | Adjustment represents a $27,700 gain recognized in Net earnings from affiliates on the remeasurement of our previously held equity interest in FAMCO. |
| (f) | Charges represent non-cash amortization of intangible assets and step-up in value of acquired inventories. |
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $5,300 is non-cash. |
| (b) | Charge represents non-cash share-based compensation expense associated with a one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our U.S. Qualified pension plan. |
| (c) | Charge represents acquisition and integration-related costs associated with the MOGAS acquisition. |
| (d) | Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition. |
11
Segment Results
(Unaudited)
Flowserve Pumps Division
| (dollars in millions) |
Q3 2026 | Q3 2025 | Change | YTD 2026 | YTD 2025 | Change | ||||||||||||||||||
| Organic Bookings |
10.9 | % | 6.8 | % | ||||||||||||||||||||
| Acquisitions / Divestitures Impact |
3.9 | % | 1.8 | % | ||||||||||||||||||||
| FX Impact (a) |
(0.1 | %) | 1.9 | % | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total Bookings (b) |
$ | 940 | $ | 819 | 14.7 | % | $ | 2,646 | $ | 2,395 | 10.5 | % | ||||||||||||
| Organic Sales |
(0.9 | %) | (3.6 | %) | ||||||||||||||||||||
| Acquisitions / Divestitures Impact |
4.7 | % | 1.2 | % | ||||||||||||||||||||
| FX Impact (a) |
0.0 | % | 1.8 | % | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Reported Sales (b) |
$ | 830 | $ | 800 | 3.8 | % | $ | 2,389 | $ | 2,402 | (0.6 | %) | ||||||||||||
| Gross Margin |
37.8 | % | 33.2 | % | 460 bps | 36.8 | % | 34.7 | % | 210 bps | ||||||||||||||
| Adjusted Gross Margin (c) |
38.1 | % | 35.9 | % | 220 bps | 37.9 | % | 35.8 | % | 210 bps | ||||||||||||||
| Operating Margin |
20.2 | % | 16.9 | % | 330 bps | 19.9 | % | 18.1 | % | 180 bps | ||||||||||||||
| Adjusted Operating Margin (d) |
21.8 | % | 19.6 | % | 220 bps | 20.8 | % | 19.2 | % | 160 bps | ||||||||||||||
| Backlog (b) |
$ | 2,377 | $ | 2,007 | 18.5 | % | $ | 2,377 | $ | 2,007 | 18.5 | % | ||||||||||||
| Flows Control Division | ||||||||||||||||||||||||
| (dollars in millions) |
Q3 2026 | Q3 2025 | Change | YTD 2026 | YTD 2025 | Change | ||||||||||||||||||
| Organic Bookings |
0.8 | % | 4.8 | % | ||||||||||||||||||||
| Acquisitions / Divestitures Impact |
12.2 | % | 4.3 | % | ||||||||||||||||||||
| FX Impact (a) |
(0.4 | %) | 0.7 | % | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total Bookings (b) |
$ | 446 | $ | 396 | 12.6 | % | $ | 1,236 | $ | 1,126 | 9.8 | % | ||||||||||||
| Organic Sales |
(1.3 | %) | (5.8 | %) | ||||||||||||||||||||
| Acquisitions / Divestitures Impact |
10.8 | % | 3.7 | % | ||||||||||||||||||||
| FX Impact (a) |
(0.4 | %) | 0.6 | % | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Reported Sales (b) |
$ | 412 | $ | 377 | 9.1 | % | $ | 1,096 | $ | 1,113 | (1.5 | %) | ||||||||||||
| Gross Margin |
24.0 | % | 30.3 | % | (630 bps | ) | 27.0 | % | 28.9 | % | (190 bps | ) | ||||||||||||
| Adjusted Gross Margin (c) |
33.2 | % | 32.1 | % | 110 bps | 33.1 | % | 31.1 | % | 200 bps | ||||||||||||||
| Operating Margin |
8.3 | % | 12.3 | % | (400 bps | ) | 7.9 | % | 10.4 | % | (250 bps | ) | ||||||||||||
| Adjusted Operating Margin (d) |
16.3 | % | 16.3 | % | — | 15.0 | % | 13.6 | % | 140 bps | ||||||||||||||
| Backlog (b) |
$ | 1,105 | $ | 896 | 23.2 | % | $ | 1,105 | $ | 896 | 23.2 | % | ||||||||||||
| (a) | Constant foreign exchange (FX) represents the year-over-year variance assuming Q3 and YTD 2026 results at Q3 and YTD 2025 FX rates |
| (b) | Bookings, sales, and backlog do not include interdivision eliminations |
| (c) | Adjusted gross margin is a non-GAAP financial measure. Adjusted gross margin is calculated by dividing adjusted gross profit by sales. Adjusted gross profit is derived by excluding realignment charges and other specific discrete items. See the Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (unaudited) |
| (d) | Adjusted operating margin excludes realignment charges and other specific discrete items |
12
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| (Amounts in thousands, except par value) | September 30, 2026 |
December 31, 2025 |
||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 742,148 | $ | 760,183 | ||||
| Accounts receivable, net of allowance for expected credit losses of $92,193 and $83,094, respectively |
1,084,291 | 1,029,095 | ||||||
| Contract assets, net of allowance for expected credit losses of $6,124 and $6,028, respectively |
330,293 | 322,472 | ||||||
| Inventories |
844,122 | 789,898 | ||||||
| Prepaid expenses and other |
127,820 | 141,237 | ||||||
|
|
|
|
|
|||||
| Total current assets |
3,128,674 | 3,042,885 | ||||||
| Property, plant, and equipment, net of accumulated depreciation of $1,242,388 and $1,224,912, respectively |
574,771 | 566,751 | ||||||
| Operating lease right-of-use asset, net |
189,000 | 166,031 | ||||||
| Goodwill |
1,697,977 | 1,391,988 | ||||||
| Deferred taxes |
181,605 | 156,250 | ||||||
| Other intangible assets, net |
369,747 | 198,475 | ||||||
| Other assets, net of allowance for expected credit losses of $66,210 and $66,047, respectively |
205,227 | 185,820 | ||||||
|
|
|
|
|
|||||
| Total assets |
$ | 6,347,001 | $ | 5,708,200 | ||||
|
|
|
|
|
|||||
| LIABILITIES AND EQUITY |
| |||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 556,532 | $ | 554,243 | ||||
| Accrued liabilities |
556,768 | 587,475 | ||||||
| Contract liabilities |
329,380 | 274,669 | ||||||
| Debt due within one year |
9,895 | 49,868 | ||||||
| Operating lease liabilities |
38,093 | 35,630 | ||||||
|
|
|
|
|
|||||
| Total current liabilities |
1,490,668 | 1,501,885 | ||||||
| Long-term debt due after one year |
2,046,807 | 1,525,210 | ||||||
| Operating lease liabilities |
163,348 | 149,565 | ||||||
| Retirement obligations and other liabilities |
262,767 | 277,216 | ||||||
| Contingencies (See Note 12) |
||||||||
| Shareholders’ equity: |
||||||||
| Preferred shares, $1.00 par value |
— | — | ||||||
| Shares authorized — 1,000, no shares issued |
||||||||
| Common shares, $1.25 par value |
220,991 | 220,991 | ||||||
| Shares authorized — 305,000 |
||||||||
| Shares issued — 176,793 and 176,793, respectively |
||||||||
| Capital in excess of par value |
504,791 | 508,890 | ||||||
| Retained earnings |
4,460,774 | 4,261,977 | ||||||
| Treasury shares, at cost — 50,173 and 49,763 shares, respectively |
(2,290,306 | ) | (2,231,685 | ) | ||||
| Deferred compensation obligation |
5,922 | 6,629 | ||||||
| Accumulated other comprehensive loss |
(590,627 | ) | (575,405 | ) | ||||
|
|
|
|
|
|||||
| Total Flowserve Corporation shareholders’ equity |
2,311,545 | 2,191,397 | ||||||
| Noncontrolling interests |
71,866 | 62,927 | ||||||
|
|
|
|
|
|||||
| Total equity |
2,383,411 | 2,254,324 | ||||||
|
|
|
|
|
|||||
| Total liabilities and equity |
$ | 6,347,001 | $ | 5,708,200 | ||||
|
|
|
|
|
|||||
13
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Amounts in thousands)
| Nine Months Ended September 30, |
||||||||
| 2026 | 2025 | |||||||
| Cash flows — Operating activities: |
||||||||
| Net earnings, including noncontrolling interests |
295,007 | 391,539 | ||||||
| Adjustments to reconcile net earnings to net cash provided by operating activities |
||||||||
| Depreciation |
61,537 | 58,685 | ||||||
| Amortization of intangible and other assets |
24,750 | 14,009 | ||||||
| (Gain) on remeasurement of previously held equity interest |
(27,700 | ) | — | |||||
| (Gain) on sale of business |
(16,177 | ) | — | |||||
| Stock-based compensation |
30,469 | 25,787 | ||||||
| Loss on Blue Chip Swap Securities |
3,146 | — | ||||||
| Foreign currency, asset write downs and other non-cash adjustments |
(5,446 | ) | (3,326 | ) | ||||
| Change in assets and liabilities: |
||||||||
| Accounts receivable, net |
(28,684 | ) | (26,081 | ) | ||||
| Inventories |
(7,421 | ) | 26,727 | |||||
| Contract assets, net |
(8,198 | ) | (35,157 | ) | ||||
| Prepaid expenses and other assets, net |
15,698 | (7,362 | ) | |||||
| Accounts payable |
(34,192 | ) | 31,158 | |||||
| Contract liabilities |
18,750 | (17,857 | ) | |||||
| Accrued liabilities |
(60,582 | ) | (30,488 | ) | ||||
| Retirement obligations and other liabilities |
(5,779 | ) | 31,900 | |||||
| Net deferred taxes |
(24,897 | ) | 46,524 | |||||
|
|
|
|
|
|||||
| Net cash flows provided by operating activities |
230,281 | 506,058 | ||||||
|
|
|
|
|
|||||
| Cash flows — Investing activities: |
||||||||
| Capital expenditures |
(51,056 | ) | (45,534 | ) | ||||
| Payments for acquisitions, net of cash acquired |
(517,735 | ) | — | |||||
| Proceeds from disposal of assets |
9,783 | 1,067 | ||||||
| Purchases of Blue Chip Swap Securities |
(52,939 | ) | — | |||||
| Proceeds from Sales of Blue Chip Swap Securities |
49,793 | — | ||||||
| Proceeds from divestiture of business, net of cash divested |
34,567 | — | ||||||
| Affiliate investment activity |
(3,960 | ) | — | |||||
|
|
|
|
|
|||||
| Net cash flows (used) by investing activities |
(531,547 | ) | (44,467 | ) | ||||
|
|
|
|
|
|||||
| Cash flows — Financing activities: |
||||||||
| Proceeds from issuance of senior notes, net of discount |
499,320 | — | ||||||
| Payments on term loan |
(77,875 | ) | (28,125 | ) | ||||
| Proceeds from long-term debt |
74,750 | — | ||||||
| Payment of deferred loan costs |
(4,893 | ) | — | |||||
| Proceeds under revolving credit facility |
150,000 | 50,000 | ||||||
| Payments under revolving credit facility |
(160,000 | ) | (50,000 | ) | ||||
| Proceeds under other financing arrangements |
1,071 | 10,562 | ||||||
| Payments under other financing arrangements |
(8,058 | ) | (3,310 | ) | ||||
| Payments related to tax withholding for stock-based compensation |
(23,339 | ) | (11,584 | ) | ||||
| Repurchases of common shares |
(75,000 | ) | (197,920 | ) | ||||
| Payments of dividends |
(82,881 | ) | (82,671 | ) | ||||
| Contingent consideration payment related to acquired business |
— | (15,000 | ) | |||||
| Other |
(2,123 | ) | (2,899 | ) | ||||
|
|
|
|
|
|||||
| Net cash flows (used) provided by financing activities |
290,972 | (330,947 | ) | |||||
|
|
|
|
|
|||||
| Effect of exchange rate changes on cash and cash equivalents |
(7,741 | ) | 27,762 | |||||
|
|
|
|
|
|||||
| Net change in cash and cash equivalents |
(18,035 | ) | 158,406 | |||||
| Cash and cash equivalents at beginning of period |
760,183 | 675,441 | ||||||
|
|
|
|
|
|||||
| Cash and cash equivalents at end of period |
$ | 742,148 | $ | 833,847 | ||||
|
|
|
|
|
|||||
| Non-Cash Investing and Financing Activities: |
||||||||
| Liabilities incurred related to acquired business, but not paid |
$ | 1,505 | — | |||||
14
About Flowserve:
Flowserve Corporation is one of the world’s leading providers of fluid motion and control products and services. Operating in more than 50 countries, the Company produces engineered and industrial pumps, seals and valves as well as a range of related flow management services. More information about Flowserve can be obtained by visiting the Company’s website at www.flowserve.com.
Flowserve Contacts
Investor Contact: investorrelations@flowserve.com
Olivia Webb, Director, Investor Relations
Media Contact: media@flowserve.com
Safe Harbor Statement: This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Words or phrases such as, “may,” “should,” “expects,” “could,” “intends,” “plans,” “anticipates,” “estimates,” “believes,” “forecasts,” “predicts” or other similar expressions are intended to identify forward-looking statements, which include, without limitation, earnings forecasts, statements relating to our business strategy and statements of expectations, beliefs, future plans and strategies and anticipated developments concerning our industry, business, operations and financial performance and condition.
The forward-looking statements included in this news release are based on our current expectations, projections, estimates and assumptions. These statements are only predictions, not guarantees. Such forward-looking statements are subject to numerous risks and uncertainties that are difficult to predict. These risks and uncertainties may cause actual results to differ materially from what is forecast in such forward-looking statements, and include, without limitation, the following: economic, political and other risks associated with our international operations, including military actions, trade embargoes, blockades or other closures of major trade lanes, epidemics or pandemics and changes to tariffs or trade agreements that could affect customer markets, particularly North African, Latin American, Asian and Middle Eastern markets and global oil and gas producers, and non-compliance with U.S. export/re-export control, foreign corrupt practice laws, economic sanctions and import laws and regulations; global supply chain disruptions and the current inflationary environment could adversely affect the efficiency of our manufacturing and increase the cost of providing our products to customers; a portion of our bookings may not lead to completed sales, and our ability to convert bookings into revenues at acceptable profit margins; changes in global economic conditions and the potential for unexpected cancellations or delays of customer orders in our reported backlog; our dependence on our customers’ ability to make required capital investment and maintenance expenditures; if we are not able to successfully execute and realize the expected financial benefits from any restructuring and realignment initiatives, our business could be adversely affected; the substantial dependence of our sales on the success of the energy, chemical, power generation and general industries; the adverse impact of volatile raw materials prices on our products and operating margins; the impact of public health emergencies, such as outbreaks of epidemics, pandemics, and contagious diseases, on our business and operations; increased aging and slower collection of receivables, particularly in Latin America and other emerging markets; potential adverse effects resulting from the implementation of new tariffs and related retaliatory actions and changes to or uncertainties related to tariffs and trade agreements; our exposure to fluctuations in foreign currency exchange rates, including in hyperinflationary countries such as Argentina; potential adverse consequences resulting from litigation to which we are a party; expectations regarding acquisitions and the integration of acquired businesses; the potential adverse impact of an impairment in the carrying value of goodwill or other intangible assets; our dependence upon third-party suppliers whose failure to perform timely could adversely affect our business operations; the highly competitive nature of the markets in which we operate; if we are not able to maintain our competitive position by successfully developing and introducing new products and integrating new technologies, including artificial intelligence and machine learning; environmental compliance costs and liabilities; potential work stoppages and other labor matters; access to public and private sources of debt financing; our inability to protect our intellectual property in the United States, as well as in foreign countries; obligations under our defined benefit pension plans; our internal control over financial reporting may not prevent or detect misstatements because of its inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud; the recording of increased deferred tax asset valuation allowances in the future or the impact of tax law changes on such deferred tax assets could affect our operating results; our information technology infrastructure could be subject to service interruptions, data corruption, cyber-based attacks or network security breaches, which could disrupt our business operations and result in the loss of critical and confidential information; ineffective internal controls could impact the accuracy and timely reporting of our business and financial results; and other factors described from time to time in our filings with the Securities and Exchange Commission.
All forward-looking statements included in this news release are based on information available to us on the date hereof, and we assume no obligation to update any forward-looking statement.
The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company’s performance. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.
###
15