8-K
FLOWSERVE CORP (FLS)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 29, 2025
FLOWSERVE CORPORATION
(Exact Name of Registrant as Specified in its Charter)
| New York | 1-13179 | 31-0267900 |
|---|---|---|
| (State or Other Jurisdiction<br>of Incorporation) | (Commission<br>File Number) | (IRS Employer<br> <br>Identification No.) |
| 5215 N. O’Connor Blvd., Suite 700, Irving, Texas | 75039 | |
| (Address of Principal Executive Offices) | (Zip Code) |
(972) 443-6500
(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<br>Symbol(s) | Name of each exchange<br>on which registered |
|---|---|---|
| Common Stock, $1.25 Par Value | FLS | New York Stock Exchange |
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 April 29, 2025, Flowserve Corporation, a New York corporation (the “Company”), issued a press release announcing financial results for the first quarter ended March 31, 2025. A copy of this press release is attached as Exhibit 99.1 and incorporated herein by reference.
The information in this Item 2.02 of Form 8-K and in Exhibit 99.1 attached hereto is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
| Item 7.01 | Regulation FD Disclosure. |
|---|
On April 30, 2025, the Company will make a presentation about its financial and operating results for the first quarter of 2025, 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 in this Item 7.01 of Form 8-K and in Exhibit 99.1 attached hereto is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
|---|---|
| (d) | Exhibits. |
| --- | --- |
| Exhibit<br>No. | Description |
| --- | --- |
| 99.1 | Press Release, dated April 29, 2025. |
| 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: April 29, 2025 | By: | /s/ Amy B. Schwetz |
| Amy B. Schwetz | ||
| Senior Vice President, Chief Financial Officer |
EX-99.1
Exhibit 99.1
Flowserve Corporation Reports First Quarter 2025 Results
Strong Start to the Year; Reaffirms Full-year 2025 Guidance
DALLAS, April 29, 2025 – Flowserve Corporation (NYSE: FLS), a leading provider of flow control products and services for the global infrastructure markets, reported its financial results for the first quarter ended March 31, 2025.
Highlights:
| • | First quarter bookings of $1.2 billion, including record aftermarket bookings of nearly $690 million<br> |
|---|---|
| • | Power bookings increased more than 45% year-over-year, with over $100 million in nuclear awards for the<br>third consecutive quarter |
| --- | --- |
| • | Gross margin and adjusted^1^ gross margin^2^ of 32.3% and 33.5%, respectively, increased 110 and 180 basis points versus the prior year period |
| --- | --- |
| • | Operating income and adjusted operating income^3^ of<br>$132 million and $147 million, respectively, an increase of 17% and 24% compared to last year |
| --- | --- |
| • | Reported and Adjusted Earnings Per Share (EPS)^4^ of 56 and<br>72 cents, respectively |
| --- | --- |
Management Commentary*:*
“Our first quarter results were a strong start to the year, with robust bookings growth, margin expansion, and earnings acceleration all driven by healthy end markets and improved execution. These results demonstrate the strength of our diversified portfolio and the exceptional performance of our associates around the world operating under the Flowserve Business System,” said Scott Rowe, Flowserve’s President and Chief Executive Officer.
Rowe continued, “As we pivot to the second quarter and rest of the year, the macro environment has become more dynamic as tariffs increase global uncertainty. While we continue to monitor the environment closely, I am confident in our ability to navigate these rapidly evolving challenges. With $2.9 billion of backlog, improved execution, and expected benefits from the Flowserve Business System, we are positioned well to create value for our customers, shareholders, and associates.”
Key Figures*:*
| (dollars in millions, except per share) | 2025 Q1 | 2024 Q1 | Change | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Backlog | $ | 2,902.9 | $ | 2,612.5 | 11.1 | % | |||
| Bookings | $ | 1,226.4 | $ | 1,038.3 | 18.1 | % | |||
| Original Equipment | $ | 537.8 | $ | 462.5 | 16.3 | % | |||
| Aftermarket | $ | 688.6 | $ | 575.8 | 19.6 | % | |||
| Sales^5^ | $ | 1,144.5 | $ | 1,087.5 | 5.2 | % | |||
| Organic | 410 bps | ||||||||
| Acquisitions | 330 bps | ||||||||
| Foreign Exchange | (220) bp | s | |||||||
| Operating Margin | 11.5 | % | 10.4 | % | 110 bps | ||||
| Adjusted Operating Margin | 12.8 | % | 10.9 | % | 190 bps | ||||
| Earnings Per Share | $ | 0.56 | $ | 0.56 | — | ||||
| Adjusted Earnings Per Share | $ | 0.72 | $ | 0.58 | 24.1 | % | |||
| Cash From Operations | ($ | 49.9 | ) | $ | 62.3 | (180.2 | %) |
2025 Guidance:
The Company reaffirmed its full-year 2025 guidance communicated on February 18, 2025, including Adjusted EPS target range of $3.10 to $3.30. 2025 guidance reflects the estimated impact of recently announced tariffs, net of estimated mitigating actions.
| Guidance | |
|---|---|
| Organic sales growth | +3% to +5% |
| Impact from acquisitions | Approx. +300 bps |
| Impact from foreign exchange translation | Approx. (100) to 0 bps |
| Total sales growth | +5% to +7% |
| Adjusted EPS | $3.10 to $3.30 |
| Net interest expense | Approx. $70 million |
| Adjusted tax rate | Approx. 21% |
| Capital expenditures | $80 to $90 million |
2
Webcast and Conference Call Instructions:
Flowserve will host its conference call to discuss first quarter results on Wednesday, April 30, at 10:00 a.m. Eastern Time. The call can be accessed by shareholders and other interested parties on Flowserve’s Investors page.
Footnotes (pages 1-2)
| ^1^ | See Consolidated Reconciliation of Non-GAAP Financial Measures to the<br>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<br>reconciliation of reported results to adjusted measures. |
|---|---|
| ^2^ | Adjusted gross margin is calculated by dividing adjusted gross profit by sales. Adjusted gross profit is<br>derived by excluding the adjusted items.^^ |
| --- | --- |
| ^3^ | Adjusted operating margin is calculated by dividing adjusted operating income by sales. Adjusted operating<br>income is derived by excluding the adjusted items. |
| --- | --- |
| ^4^ | Adjusted 2025 EPS excludes potential realignment expenses, below-the-line foreign currency effects, and certain other discrete items which may arise during the year and utilizes foreign exchange rates of the prior 30-day period<br>and approximately 132 million fully diluted shares. |
| --- | --- |
| ^5^ | Organic is defined as the change in Sales, as defined by U.S. GAAP, excluding the impacts of currency<br>translation and acquisitions. 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 March 31, | ||||||
|---|---|---|---|---|---|---|
| (Amounts in thousands, except per share data) | 2025 | 2024 | ||||
| Sales | $ | 1,144,543 | $ | 1,087,479 | ||
| Cost of sales | (775,209 | ) | (748,511 | ) | ||
| Gross profit | 369,334 | 338,968 | ||||
| Selling, general and administrative expense | (243,177 | ) | (228,418 | ) | ||
| Net earnings from affiliates | 5,732 | 2,529 | ||||
| Operating income | 131,889 | 113,079 | ||||
| Interest expense | (19,175 | ) | (15,317 | ) | ||
| Interest income | 1,745 | 1,169 | ||||
| Other income (expense), net | (17,259 | ) | (874 | ) | ||
| Earnings (loss) before income taxes | 97,200 | 98,057 | ||||
| (Provision for) benefit from income taxes | (17,743 | ) | (20,142 | ) | ||
| Net earnings (loss), including noncontrolling interests | 79,457 | 77,915 | ||||
| Less: Net earnings attributable to noncontrolling interests | (5,552 | ) | (3,695 | ) | ||
| Net earnings (loss) attributable to Flowserve Corporation | $ | 73,905 | $ | 74,220 | ||
| Net earnings (loss) per share attributable to Flowserve Corporation common shareholders: | ||||||
| Basic | $ | 0.56 | $ | 0.56 | ||
| Diluted | 0.56 | 0.56 | ||||
| Weighted average shares – basic | 131,566 | 131,510 | ||||
| Weighted average shares – diluted | 132,670 | 132,368 |
4
Consolidated Reconciliation of Non-GAAP Financial Measures to theMost Directly Comparable GAAP Financial Measure (Unaudited)
(Amounts in thousands, except per share data)
| Three Months Ended March 31, 2025 | Gross Profit | Selling,General &AdministrativeExpense | OperatingIncome | OtherIncome(Expense),Net | Provision For(Benefit From)Income Taxes | Net Earnings(Loss) | EffectiveTax Rate | DilutedEPS | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Reported | $ | 369,334 | **** | $ | 243,177 | **** | $ | 131,889 | **** | $ | (17,259) | **** | $ | 17,743 | **** | $ | 73,905 | **** | **** | 18.3 | % | **** | 0.56 |
| Reported as a percent of sales | 32.3 | % | 21.2 | % | 11.5 | % | -1.5 | % | 1.6 | % | 6.5 | % | |||||||||||
| Realignment charges (a) | 10,015 | 1,304 | 8,711 | — | 1,871 | 6,840 | 21.5 | % | 0.05 | ||||||||||||||
| Acquisition related (b) | — | (1,281 | ) | 1,281 | — | 301 | 980 | 23.5 | % | 0.01 | |||||||||||||
| Purchase accounting step-up and intangible asset<br>amortization (c) | 3,475 | (1,300 | ) | 4,775 | — | 1,361 | 3,414 | 28.5 | % | 0.03 | |||||||||||||
| Discrete items (d)(e) | 33 | (383 | ) | 416 | 1,500 | 451 | 1,465 | 23.5 | % | 0.01 | |||||||||||||
| Below-the-line<br>foreign exchange impacts (f) | — | — | — | 11,373 | 2,445 | 8,928 | 21.5 | % | 0.07 | ||||||||||||||
| Adjusted | $ | 382,857 | **** | $ | 241,517 | **** | $ | 147,072 | **** | $ | (4,386 | ) | $ | 24,172 | **** | $ | 95,532 | **** | **** | 19.3 | % | **** | 0.72 |
| Adjusted as a percent of sales | 33.5 | % | 21.1 | % | 12.8 | % | -0.4 | % | 2.1 | % | 8.3 | % |
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $1,500 is non-cash. | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (b) | Charge represents acquisition and integration related costs associated with the MOGAS acquisition.<br> | |||||||||||||||||||||||
| --- | --- | |||||||||||||||||||||||
| (c) | Charge represents amortization of step-up in value of acquired<br>inventories and acquisition related intangible assets associated with the MOGAS acquisition. | |||||||||||||||||||||||
| --- | --- | |||||||||||||||||||||||
| (d) | Charge represents share-based compensation expense associated with a<br>one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our US Qualified pension plan. | |||||||||||||||||||||||
| --- | --- | |||||||||||||||||||||||
| (e) | Charge represents a pension settlement accounting loss incurred in conjunction with the freeze of our US<br>Qualified pension plan. | |||||||||||||||||||||||
| --- | --- | |||||||||||||||||||||||
| (f) | Below-the-line foreign exchange<br>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. | |||||||||||||||||||||||
| --- | --- | |||||||||||||||||||||||
| Three Months Ended March 31, 2024 | Gross Profit | Selling,General &AdministrativeExpense | OperatingIncome | OtherIncome(Expense),Net | Provision For(Benefit From)Income Taxes | Net Earnings(Loss) | EffectiveTax Rate | DilutedEPS | ||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Reported | $ | 338,968 | **** | $ | 228,418 | **** | $ | 113,079 | **** | $ | (874 | ) | $ | 20,142 | **** | $ | 74,220 | **** | **** | 20.5 | % | **** | 0.56 | **** |
| Reported as a percent of sales | 31.2 | % | 21.0 | % | 10.4 | % | -0.1 | % | 1.9 | % | 6.8 | % | ||||||||||||
| Realignment charges (a) | 5,673 | (1,494 | ) | 7,167 | — | 723 | 6,444 | 10.1 | % | 0.05 | ||||||||||||||
| Discrete item (b) | — | 2,000 | (2,000 | ) | — | — | (2,000 | ) | 0.0 | % | (0.02 | ) | ||||||||||||
| Below-the-line<br>foreign exchange impacts (c) | — | — | — | (1,323 | ) | (51 | ) | (1,273 | ) | 3.8 | % | (0.01 | ) | |||||||||||
| Adjusted | $ | 344,641 | **** | $ | 228,924 | **** | $ | 118,246 | **** | $ | (2,197 | ) | $ | 20,814 | **** | $ | 77,392 | **** | **** | 20.4 | % | **** | 0.58 | **** |
| Adjusted as a percent of sales | 31.7 | % | 21.1 | % | 10.9 | % | -0.2 | % | 1.9 | % | 7.1 | % |
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $800 is non-cash. |
|---|---|
| (b) | Represents a reduction to reserves associated with our ongoing financial exposure in Russia that were adjusted<br>for Non-GAAP measures when established in 2022. |
| --- | --- |
| (c) | Below-the-line foreign exchange<br>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)
| FLOWSERVE PUMPS DIVISION | Three Months Ended March 31, | |||||
|---|---|---|---|---|---|---|
| (Amounts in millions, except percentages) | 2025 | 2024 | ||||
| Bookings | $ | 852.9 | $ | 703.5 | ||
| Sales | 783.1 | 769.4 | ||||
| Gross profit | 268.5 | 247.9 | ||||
| Gross profit margin | 34.3 | % | 32.2 | % | ||
| SG&A | 137.7 | 139.7 | ||||
| Segment operating income | 136.5 | 110.9 | ||||
| Segment operating income as a percentage of sales | 17.4 | % | 14.4 | % | ||
| FLOW CONTROL DIVISION | Three Months Ended March 31, | |||||
| (Amounts in millions, except percentages) | 2025 | 2024 | ||||
| Bookings | $ | 376.0 | $ | 341.1 | ||
| Sales | 364.1 | 320.5 | ||||
| Gross profit | 100.2 | 92.7 | ||||
| Gross profit margin | 27.5 | % | 28.9 | % | ||
| SG&A | 68.7 | 58.0 | ||||
| Segment operating income | 31.5 | 34.7 | ||||
| Segment operating income as a percentage of sales | 8.6 | % | 10.8 | % |
6
Segment Reconciliation of Non-GAAP Financial Measures to the MostDirectly Comparable GAAP Financial Measure (Unaudited)
(Amounts in thousands)
Flowserve Pumps Division
| Three Months EndedMarch 31, 2025 | Gross Profit | Selling,General &AdministrativeExpense | OperatingIncome | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Reported | $ | 268,462 | **** | $ | 137,680 | **** | $ | 136,515 | **** |
| Reported as a percent of sales | 34.3 | % | 17.6 | % | 17.4 | % | |||
| Realignment charges (a) | 2,979 | 998 | 1,981 | ||||||
| Discrete items (b) | 28 | (125 | ) | 153 | |||||
| Adjusted | $ | 271,469 | **** | $ | 138,553 | **** | $ | 138,649 | **** |
| Adjusted as a percent of sales | 34.7 | % | 17.7 | % | 17.7 | % |
Flow Control Division
| Three Months EndedMarch 31, 2025 | Gross Profit | Selling,General &AdministrativeExpense | OperatingIncome | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Reported | $ | 100,187 | **** | $ | 68,705 | **** | $ | 31,482 | **** |
| Reported as a percent of sales | 27.5 | % | 18.9 | % | 8.6 | % | |||
| Realignment charges (a) | 7,102 | 121 | 6,981 | ||||||
| Acquisition related (c) | — | (1,281 | ) | 1,281 | |||||
| Purchase accounting step-up and intangible<br>asset amortization (d) | 3,475 | (1,300 | ) | 4,775 | |||||
| Discrete items (b) | 4 | (64 | ) | 68 | |||||
| Adjusted | $ | 110,768 | **** | $ | 66,181 | **** | $ | 44,587 | **** |
| Adjusted as a percent of sales | 30.4 | % | 18.2 | % | 12.2 | % |
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $1,500 is non-cash. | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| (b) | Charge represents share-based compensation expense associated with a<br>one-time discretionary restricted stock grant, subject to three-year cliff vesting, provided to certain employees in conjunction with the freeze of our US Qualified pension plan. | ||||||||
| --- | --- | ||||||||
| (c) | Charge represents acquisition and integration-related costs associated with the MOGAS acquisition.<br> | ||||||||
| --- | --- | ||||||||
| (d) | Charge represents amortization of step-up in value of acquired<br>inventories and acquisition related intangible assets associated with the MOGAS acquisition.<br> | ||||||||
| --- | --- | ||||||||
| Three Months EndedMarch 31, 2024 | Gross Profit | Selling,General &AdministrativeExpense | OperatingIncome | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Reported | $ | 247,938 | **** | $ | 139,710 | **** | $ | 110,894 | **** |
| Reported as a percent of sales | 32.2 | % | 18.2 | % | 14.4 | % | |||
| Realignment charges (a) | 5,044 | (1,041 | ) | 6,085 | |||||
| Discrete item (b) | — | 2,000 | (2,000 | ) | |||||
| Adjusted | $ | 252,982 | **** | $ | 140,669 | **** | $ | 114,979 | **** |
| Adjusted as a percent of sales | 32.9 | % | 18.3 | % | 14.9 | % | |||
| Flow Control Division | |||||||||
| Three Months EndedMarch 31, 2024 | Gross Profit | Selling,General &AdministrativeExpense | OperatingIncome | ||||||
| Reported | $ | 92,695 | **** | $ | 57,987 | **** | $ | 34,708 | **** |
| Reported as a percent of sales | 28.9 | % | 18.1 | % | 10.8 | % | |||
| Realignment charges (a) | 767 | (114 | ) | 881 | |||||
| Adjusted | $ | 93,462 | **** | $ | 57,873 | **** | $ | 35,589 | **** |
| Adjusted as a percent of sales | 29.2 | % | 18.1 | % | 11.1 | % |
Note: Amounts may not calculate due to rounding
| (a) | Charges represent realignment costs incurred as a result of realignment programs of which $800 is non-cash. |
|---|---|
| (b) | Represents a reduction to reserves associated with our ongoing financial exposure in Russia that were adjusted<br>for Non-GAAP measures when established in 2022. |
| --- | --- |
7
| 1st Quarter 2025 - Segment Results | ||||||
|---|---|---|---|---|---|---|
| (dollars in millions, comparison vs. 2024 first quarter, unaudited) | ||||||
| FPD | FCD | |||||
| 1st Qtr | 1st Qtr | |||||
| Bookings | $ | 852.9 | $ | 376.0 | ||
| - vs. prior year | 149.4 | 21.2% | 34.9 | 10.2% | ||
| - on constant currency | 169.7 | 24.1% | 39.9 | 11.7% | ||
| Sales | $ | 783.1 | $ | 364.1 | ||
| - vs. prior year | 13.7 | 1.8% | 43.6 | 13.6% | ||
| - on constant currency | 32.6 | 4.2% | 48.9 | 15.3% | ||
| Gross Profit | $ | 268.5 | $ | 100.2 | ||
| - vs. prior year | 8.3% | 8.1% | ||||
| Gross Margin (% of sales) | 34.3% | 27.5% | ||||
| - vs. prior year (in basis points) | 210 bps | (140) bps | ||||
| Operating Income | $ | 136.5 | $ | 31.5 | ||
| - vs. prior year | 25.6 | 23.1% | -3.2 | -9.3% | ||
| - on constant currency | 29.1 | 26.2% | -2.4 | -7.0% | ||
| Operating Margin (% of sales) | 17.4% | 8.6% | ||||
| - vs. prior year (in basis points) | 300 bps | (220) bps | ||||
| Adjusted Operating Income * | $ | 138.6 | $ | 44.6 | ||
| - vs. prior year | 23.7 | 20.6% | 9.0 | 25.3% | ||
| - on constant currency | 27.1 | 23.6% | 9.8 | 27.6% | ||
| Adj. Oper. Margin (% of sales)* | 17.7% | 12.2% | ||||
| - vs. prior year (in basis points) | 280 bps | 110 bps | ||||
| Backlog | $ | 2,018.7 | $ | 889.4 | ||
| * | Adjusted Operating Income and Adjusted Operating Margin exclude realignment charges and other specific discrete<br>items | |||||
| --- | --- |
8
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| December 31, | |||||
|---|---|---|---|---|---|
| (Amounts in thousands, except par value) | 2024 | ||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 540,804 | $ | 675,441 | ||
| Accounts receivable, net of allowance for expected credit losses of 85,444 and 79,059,<br>respectively | 1,043,707 | 976,739 | |||
| Contract assets, net of allowance for expected credit losses of 3,997 and 3,404,<br>respectively | 312,154 | 298,906 | |||
| Inventories | 841,546 | 837,254 | |||
| Prepaid expenses and other | 126,696 | 116,157 | |||
| Total current assets | 2,864,907 | 2,904,497 | |||
| Property, plant and equipment, net of accumulated depreciation of 1,173,858 and 1,142,667,<br>respectively | 542,490 | 539,703 | |||
| Operating lease<br>right-of-use assets, net | 161,743 | 159,400 | |||
| Goodwill | 1,303,111 | 1,286,295 | |||
| Deferred taxes | 219,849 | 221,742 | |||
| Other intangible assets, net | 184,689 | 188,604 | |||
| Other assets, net of allowance for expected credit losses of 65,940 and 66,081,<br>respectively | 206,509 | 200,580 | |||
| Total assets | 5,483,298 | $ | 5,500,821 | ||
| LIABILITIES AND EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | 537,827 | $ | 545,310 | ||
| Accrued liabilities | 481,888 | 561,486 | |||
| Contract liabilities | 284,697 | 283,670 | |||
| Debt due within one year | 44,197 | 44,059 | |||
| Operating lease liabilities | 33,689 | 33,559 | |||
| Total current liabilities | 1,382,298 | 1,468,084 | |||
| Long-term debt due after one year | 1,451,214 | 1,460,132 | |||
| Operating lease liabilities | 150,825 | 149,838 | |||
| Retirement obligations and other liabilities | 369,696 | 371,055 | |||
| 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 | 482,529 | 502,045 | |||
| Retained earnings | 4,071,710 | 4,025,750 | |||
| Treasury shares, at cost – 45,616 and 45,688 shares, respectively | (2,010,045 | ) | (2,007,869 | ) | |
| Deferred compensation obligation | 8,114 | 8,172 | |||
| Accumulated other comprehensive loss | (693,528 | ) | (741,424 | ) | |
| Total Flowserve Corporation shareholders’ equity | 2,079,771 | 2,007,665 | |||
| Noncontrolling interests | 49,494 | 44,047 | |||
| Total equity | 2,129,265 | 2,051,712 | |||
| Total liabilities and equity | 5,483,298 | $ | 5,500,821 |
All values are in US Dollars.
9
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Three Months Ended March 31, | ||||||
|---|---|---|---|---|---|---|
| (Amounts in thousands) | 2025 | 2024 | ||||
| Cash flows – Operating activities: | ||||||
| Net earnings, including noncontrolling interests | $ | 79,457 | $ | 77,915 | ||
| Adjustments to reconcile net earnings to net cash provided (used) by operating<br>activities: | ||||||
| Depreciation | 18,831 | 19,326 | ||||
| Amortization of intangible and other assets | 5,571 | 2,254 | ||||
| Stock-based compensation | 8,656 | 8,657 | ||||
| Foreign currency, asset write downs and other non-cash<br>adjustments | (7,350 | ) | 1,189 | |||
| Change in assets and liabilities: | ||||||
| Accounts receivable, net | (50,679 | ) | (39,687 | ) | ||
| Inventories | 8,804 | (11,452 | ) | |||
| Contract assets, net | (9,447 | ) | (8,051 | ) | ||
| Prepaid expenses and other assets, net | 6,669 | (16,001 | ) | |||
| Accounts payable | (16,861 | ) | 5,053 | |||
| Contract liabilities | (3,648 | ) | (6,372 | ) | ||
| Accrued liabilities | (89,467 | ) | 30,917 | |||
| Retirement obligations and other liabilities | (5,448 | ) | (2,426 | ) | ||
| Net deferred taxes | 4,978 | 935 | ||||
| Net cash flows provided (used) by operating activities | (49,934 | ) | 62,257 | |||
| Cash flows – Investing activities: | ||||||
| Capital expenditures | (11,738 | ) | (13,610 | ) | ||
| Proceeds from disposal of assets | 462 | 24 | ||||
| Net cash flows (used) by investing activities | (11,276 | ) | (13,586 | ) | ||
| Cash flows – Financing activities: | ||||||
| Payments on term loan | (9,375 | ) | (15,000 | ) | ||
| Proceeds under other financing arrangements | 150 | 72 | ||||
| Payments under other financing arrangements | (101 | ) | (25 | ) | ||
| Repurchases of common shares | (21,088 | ) | (2,549 | ) | ||
| Payments related to tax withholding for stock-based compensation | (11,063 | ) | (8,857 | ) | ||
| Payments of dividends | (27,617 | ) | (27,654 | ) | ||
| Contingent consideration payment related to acquired business | (15,000 | ) | — | |||
| Other | (138 | ) | (201 | ) | ||
| Net cash flows (used) by financing activities | (84,232 | ) | (54,214 | ) | ||
| Effect of exchange rate changes on cash and cash equivalents | 10,805 | (8,154 | ) | |||
| Net change in cash and cash equivalents | (134,637 | ) | (13,697 | ) | ||
| Cash and cash equivalents at beginning of period | 675,441 | 545,678 | ||||
| Cash and cash equivalents at end of period | $ | 540,804 | $ | 531,981 |
10
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 Contacts: | |
|---|---|
| Brian Ezzell, Vice President, Investor Relations, Treasurer & Corporate Finance | (469) 420-3222 |
| Tarek Zeni, Director, Investor Relations | (469) 420-4045 |
| Media Contact: | |
| Wes Warnock, Vice President, Marketing, Communications & Public Affairs | (972) 443-6900 |
Safe Harbor Statement: This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, 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: 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; economic, political and other risks associated with our international operations, including military actions, trade embargoes, 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; 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, such as litigation involving asbestos-containing material claims; 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 integrate 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.
11
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.
12