FLOWSERVE CORP false 0000030625 0000030625 2026-02-04 2026-02-04
 
 

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): February 4, 2026

 

 

FLOWSERVE CORPORATION

(Exact Name of Registrant as Specified in its Charter)

 

 

 

New York   1-13179   31-0267900
(State or Other Jurisdiction
of Incorporation)		   (Commission
File Number)		   (IRS Employer
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
Symbol(s)

  

Name of each exchange
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 February 5, 2026, Flowserve Corporation, a New York corporation (the “Company”), issued a press release announcing financial results for the fourth quarter and full year ended December 31, 2025. A copy of this press release is attached as Exhibit 99.1 and incorporated herein by reference.

 

Item 7.01

Regulation FD Disclosure.

Fourth Quarter and Full Year 2025 Financial and Operating Results

On February 6, 2026, the Company will make a presentation about its financial and operating results for the fourth quarter and full year ended December 31, 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.

Acquisition of Trillium Flow Technologies’ Valves Division

On February 4, 2026, the Company entered into a definitive agreement to acquire Trillium Flow Technologies’ Valves Division, a market leading provider of highly engineered mission-critical valves used in nuclear and traditional power generation, industrial, and critical infrastructure applications, for $490 million in cash (the “Transaction”).

Closing of the Transaction is expected to occur mid-year 2026. The Company expects to fund the Transaction through a combination of cash on hand and additional debt. The Transaction is subject to the satisfaction of customary closing conditions and regulatory approvals.

In connection with the Transaction, Goldman Sachs & Co LLC is serving as exclusive financial advisor and Baker McKenzie LLP is serving as legal counsel to the Company.

On February 5, 2026, the Company issued a press release announcing the Transaction, a copy of which is furnished as Exhibit 99.2 hereto.

The information furnished in Items 2.02 and 7.01 of this Form 8-K, including Exhibits 99.1 and 99.2 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, or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.

Forward-Looking Statements and Cautionary Statements

This Current Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act, 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 Current Report 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.

All forward-looking statements included in this Current Report are based on information available to us on the date hereof, and we assume no obligation to update any forward-looking statement.

Item 9.01

Financial Statements and Exhibits.

(d)  Exhibits.

 

Exhibit
No.

   

Description

99.1    Press Release, dated February 5, 2026.
99.2    Press Release, dated February 5, 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: February 5, 2026     By:  

/s/ Amy B. Schwetz

      Amy B. Schwetz
      Senior Vice President, Chief Financial Officer

EXHIBIT 99.1

 

LOGO

Flowserve Corporation Reports Fourth Quarter and Full Year 2025 Results

3D Growth Strategy and Flowserve Business System Deliver Strong Q4 and Full Year Results;

Initiated 2026 Guidance and 2030 Financial Targets

DALLAS, February 5, 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 fourth quarter and full year ended December 31, 2025.

Q4 and FY 2025 Highlights:

 

  •  

Fourth quarter bookings of $1.2 billion, including 10% aftermarket growth to over $680 million

 

  •  

Fourth quarter operating margin of 3.5%, including one-time impact from asbestos divestiture, and adjusted1 operating margin2 of 16.8%

 

  •  

Fourth quarter reported and adjusted earnings per share (EPS)3 of ($0.23) and $1.11, respectively. Reported EPS includes adjusted net expense items of $1.34, comprised of the one-time impact from asbestos divestiture, among other items

 

  •  

Full year bookings of $4.7 billion, including approximately $400 million in nuclear awards

 

  •  

Full year cash from operations of $506 million driven by strong earnings and working capital management, with $365 million of cash returned to shareholders through dividends and share repurchases

2026 and Strategic Highlights:

 

  •  

Announced acquisition of Trillium Flow Technologies’ Valves Division4

 

  •  

Initiated full year 2026 guidance3, including total sales growth of 5% to 7% and adjusted EPS of $4.00 to $4.20, which at the midpoint, represents a 13% increase versus full year 2025 adjusted EPS3

 

  •  

Established 2030 financial targets including mid-single digit organic sales CAGR, ~20% adjusted operating margin, and double digit adjusted EPS CAGR

Management Commentary:

“We delivered outstanding financial results in the fourth quarter and for the full year 2025,” said Scott Rowe, Flowserve’s President and Chief Executive Officer. “I am incredibly proud of our global team’s dedication and strong execution of the Flowserve Business System, which has been instrumental in reaching our 2027 adjusted operating margin target two years ahead of schedule.”

Rowe continued, “With healthy end markets, a focus on expanding power generation opportunities, and the continued progress of the Flowserve Business System, we are confident in our 2026 guidance and updated long-term financial targets. We have significant operational momentum and are executing with discipline to drive greater value for our associates, customers, and shareholders.”

Acquisition of Trillium Flow Technologies’ Valves Division4:

In a separate press release issued today, the Company also announced it had signed a definitive agreement to acquire Trillium Flow Technologies’ Valves Division, a market leading provider of highly engineered mission-critical valves and actuators used in nuclear, traditional power, industrial, and critical infrastructure applications. The press release can be viewed on Flowserve’s Investors page.

Key Figures (unaudited):

 

(dollars in millions, except per share)

    2025 Q4     2024 Q4     Change     2025     2024     Change  

Original Equipment Bookings

    $ 526.6     $ 557.2       (5.5 %)    $ 2,068.5     $ 2,238.4       (7.6 %) 

Aftermarket Bookings

    $ 682.3     $ 618.1       10.4 %    $ 2,644.5     $ 2,422.4       9.2 % 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Bookings

    $ 1,208.9     $ 1,175.3       2.9 %    $ 4,713.0     $ 4,660.8       1.1 % 

Organic Sales5

          0.8 %          0.9 % 

Acquisitions Impact

          30 bps           220 bps  

Foreign Exchange Impact

          240 bps           70 bps  

Reported Sales

    $ 1,222.2     $ 1,180.3       3.5 %    $ 4,729.3     $ 4,557.8       3.8 % 

Operating Margin

      3.5 %      10.6 %      (710 bps )      8.5 %      10.1 %      (160 bps ) 

Adjusted Operating Margin

      16.8 %      12.6 %      420 bps       14.8 %      11.8 %      300 bps  

Earnings Per Share

    ($ 0.23 )    $ 0.59       (139.0 %)    $ 2.64     $ 2.14       23.4 % 

Adjusted Earnings Per Share

    $ 1.11     $ 0.70       58.6 %    $ 3.64     $ 2.63       38.4 % 

Cash From Operations6

    ($ 0.2 )    $ 197.3     ($ 197.5 )    $ 505.9     $ 425.3     $ 80.6  

Backlog

    $ 2,867.8     $ 2,789.6       2.8 %    $ 2,867.8     $ 2,789.6       2.8 % 

2026 Guidance3:

The Company initiated 2026 guidance:

 

Organic Sales Growth

    +1% to +3%

Impact From Acquisitions

    Approx. +300 bps

Impact From Foreign Exchange Translation

    Approx. +100 bps

Total Sales Growth

    +5% to +7%

Adjusted EPS

    $4.00 to $4.20

Net Interest Expense

    Approx. $80 million

Adjusted Tax Rate

    21% to 22%

Capital Expenditures

    $90 million to $100 million

 

2

Full-year 2026 guidance assumes the acquisition of Trillium Flow Technologies’ Valves Division closes mid-year 2026 and, including incremental interest expense related to financing the acquisition, the acquisition will be roughly neutral to 2026 adjusted EPS. The guidance also assumes tariff rates in place as of February 1, 2026.

2030 Financial Targets:

The Company introduced 2030 financial targets, which include expectations for:

 

Organic Sales CAGR (2025-2030)    Mid-Single Digit Growth
Adjusted Operating Margin (by 2030)    ~20%
Adjusted EPS CAGR (2025-2030)    Double-Digit Growth

Webcast and Conference Call Instructions:

Flowserve will host its conference call to discuss fourth quarter and full year results on Friday, February 6, at 10:00 a.m. Eastern Time. The call can be accessed by shareholders and other interested parties on Flowserve’s Investors page.

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 EPS excludes realignment expenses, the impact from other specific discrete and below-the-line foreign currency effects and utilizes the then-applicable FX rates and fully diluted shares. Adjusted 2026 EPS excludes certain other discrete items which may arise during the year.

4

Transaction excludes Trillium Valves’ French operations.

5

Organic is defined as the change in Sales, as defined by U.S. GAAP, excluding the impacts of currency 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.

6 

Cash from Operations for the fourth quarter 2025 includes a ($199) million one-time impact from legacy asbestos liabilities divestiture. Cash from Operations for the full year 2025 includes the impact of a $173 million one-time merger termination fee paid to Flowserve (net of incurred transaction costs and taxes) and a ($199) million one-time impact from legacy asbestos liabilities divestiture.

 

3

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

     Three Months Ended December 31,  
(Amounts in thousands, except per share data)    2025     2024  

Sales

    $ 1,222,191     $ 1,180,348  

Cost of sales

      (796,956 )      (808,234 ) 
  

 

 

    

 

 

  

Gross profit

      425,235       372,114  

Selling, general and administrative expense

      (247,863 )      (251,966 ) 

Loss on divestiture of asbestos-related assets and liabilities

      (140,092 )      —   

Net earnings from affiliates

      4,893       4,557  
  

 

 

    

 

 

  

Operating income

      42,173       124,705  

Interest expense

      (19,574 )      (20,481 ) 

Interest income

      2,488       1,625  

Other income (expense), net

      (18,294 )      (137 ) 
  

 

 

    

 

 

  

Earnings before income taxes

      6,793       105,712  

Provision for income taxes

      (28,529 )      (22,202 ) 
  

 

 

    

 

 

  

Net earnings, including noncontrolling interests

      (21,736 )      83,510  

Less: Net earnings attributable to noncontrolling interests

      (7,259 )      (5,969 ) 
  

 

 

    

 

 

  

Net (loss) earnings attributable to Flowserve Corporation

    $ (28,995 )    $ 77,541  
  

 

 

    

 

 

  

Net earnings per share attributable to Flowserve Corporation common shareholders:

 

  

Basic

    $ (0.23 )    $ 0.59  

Diluted

      (0.23 )      0.59  

Weighted average shares – basic

      127,294       131,393  

Weighted average shares – diluted

      128,411       132,395  

 

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 December 31, 2025

    Gross Profit     Selling,
General &
Administrative
Expense		     Loss on
Divestiture of
Asbestos-
Related Assets
and Liabilities		     Operating
Income		     Other Income
(Expense), Net		     Provision For
(Benefit From)
Income Taxes		     Net
Earnings
(Loss)		     Effective
Tax Rate		     Diluted
EPS		  

Reported

    $ 425,235     $ 247,863     $ 140,092     $ 42,173     $ (18,294 )    $ 28,529     $ (28,995 )      420.1 %      (0.23 ) 

Reported as a percent of sales

      34.8 %      20.3 %      11.5 %      3.5 %      -1.5 %      2.3 %      -2.4 %     

Realignment charges (a)

      14,061       (2,115 )      —        16,176       —        3,591       12,585       22.2 %      0.10  

Acquisition related (b)(c)

      (126 )      (5,181 )      —        5,055       —        1,189       3,866       23.5 %      0.03  

Purchase accounting step-up and intangible asset amortization (d)

      438       (1,300 )      —        1,738       —        409       1,329       23.5 %      0.01  

Discrete items (e)(f)

      15       (296 )      —        311       8,564       206       8,669       2.3 %      0.07  

Loss on asbestos divestiture (g)

      —        —        (140,092 )      140,092       —        2,644       137,448       1.9 %      1.07  

Below-the-line foreign exchange impacts (h)

      —        —        —        —        7,096       (1,156 )      8,252       -16.3 %      0.06  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted

    $ 439,623     $ 238,971     $ —      $ 205,543     $ (2,634 )    $ 35,411     $ 143,154       19.1 %      1.11  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      36.0 %      19.6 %      0.0 %      16.8 %      -0.2 %      2.9 %      11.7 %     

Note: Amounts may not calculate due to rounding

 

(a)

Charges represent realignment costs incurred as a result of realignment programs, net of a $6,888 gain associated with the divestiture of a pump product line.

 

(b)

Charge represents $3,315 of acquisition and integration related costs associated with the MOGAS acquisition.

 

(c)

Charge represents $1,740 of costs associated with merger and acquisition activity.

 

(d)

Charge represents amortization of acquisition related intangible assets associated with the MOGAS acquisition.

 

(e)

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 US Qualified pension plan.

 

(f)

Charge includes $641 for a non-cash pension settlement accounting loss incurred in conjunction with the freeze of our US Qualified pension plan and $7,923 for a non-cash pension settlement accounting loss incurred in conjunction with a United Kingdom based pension plan.

 

(g)

Charge represents the one-time loss associated with the divestiture of our asbestos-related assets and liabilities including $199,000 of cash funded to the divested entity and $8,335 of transaction costs incurred.

 

(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.

 

Three Months Ended December 31, 2024

    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

    $ 372,114     $ 251,966     $ 124,705     $ (138 )    $ 22,202     $ 77,541       21.0 %      0.59  

Reported as a percent of sales

      31.5 %      21.3 %      10.6 %      0.0 %      1.9 %      6.6 %     

Realignment charges (a)

      11,569       (1,570 )      13,139       —        2,849       10,290       21.7 %      0.08  

Acquisition related (b)

      —        (7,150 )      7,150       —        1,682       5,468       23.5 %      0.04  

Purchase accounting step-up and intangible asset amortization (c)

      3,067       (1,033 )      4,100       —        1,300       2,800       31.7 %      0.02  

Below-the-line foreign exchange impacts (d)

      —        —        —        (4,370 )      (1,423 )      (2,947 )      32.6 %      (0.02 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted

    $ 386,750     $ 242,213     $ 149,094     $ (4,508 )    $ 26,610     $ 93,152       21.2 %      0.70  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      32.8 %      20.5 %      12.6 %      -0.4 %      2.3 %      7.9 %     

Note: Amounts may not calculate due to rounding

 

(a)

Charges represent realignment costs incurred as a result of realignment programs of which $8,600 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)

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)

 

FLOWSERVE PUMPS DIVISION    Three Months Ended December 31,  
(Amounts in millions, except percentages)    2025     2024  

Bookings

    $ 883.6     $ 816.4  

Sales

      833.0       794.9  

Gross profit

      305.2       255.7  

Gross profit margin

      36.6 %      32.2 % 

SG&A

      143.4       131.4  

Segment operating income

      166.8       129.1  

Segment operating income as a percentage of sales

      20.0 %      16.2 % 

 

FLOW CONTROL DIVISION    Three Months Ended December 31,  
(Amounts in millions, except percentages)    2025     2024  

Bookings

    $ 330.3     $ 363.4  

Sales

      391.5       387.9  

Gross profit

      123.5       118.5  

Gross profit margin

      31.5 %      30.5 % 

SG&A

      59.5       73.9  

Segment operating income

      64.0       44.6  

Segment operating income as a percentage of sales

      16.3 %      11.5 % 

 

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
December 31, 2025

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 305,245     $ 143,380     $ 166,757  

Reported as a percent of sales

      36.6 %      17.2 %      20.0 % 

Realignment charges (a)

      4,120       (3,092 )      7,212  

Discrete items (b)

      9       (36 )      45  

Acquisition related (c)

      —        (740 )      740  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 309,374     $ 139,512     $ 174,754  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      37.1 %      16.7 %      21.0 % 

Flow Control Division

 

Three Months Ended
December 31, 2025

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 123,529     $ 59,537     $ 63,992  

Reported as a percent of sales

      31.5 %      15.2 %      16.3 % 

Realignment charges (a)

      9,417       1,313       8,104  

Acquisition related (d)

      (126 )      (3,441 )      3,315  

Purchase accounting step-up and intangible asset amortization (e)

      438       (1,300 )      1,738  

Discrete items (b)

      5       (86 )      91  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 133,263     $ 56,023     $ 77,240  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      34.0 %      14.3 %      19.7 % 

Note: Amounts may not calculate due to rounding

 

(a)

Charges represent realignment costs incurred as a result of realignment programs, net of a $6,888 gain associated with the divestiture of a pump product line.

 

(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 US Qualified pension plan.

 

(c)

Charge represents costs associated with merger and acquisition activity.

 

(d)

Charge represents acquisition and integration-related costs associated with the MOGAS acquisition.

 

(e)

Charge represents amortization of acquisition related intangible assets associated with the MOGAS acquisition.

Three Months Ended
December 31, 2024

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 255,710     $ 131,402     $ 129,069  

Reported as a percent of sales

      32.2 %      16.5 %      16.2 % 

Realignment charges (a)

      9,890       (41 )      9,931  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 265,600     $ 131,361     $ 139,000  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      33.4 %      16.5 %      17.5 % 

 

 

 

 

 

 

Three Months Ended
December 31, 2024

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 118,503     $ 73,859     $ 44,592  

Reported as a percent of sales

      30.5 %      19.0 %      11.5 % 

Realignment charges (a)

      1,679       (1,655 )      3,334  

Acquisition related (b)

      —        (7,150 )      7,150  

Purchase accounting step-up and intangible asset amortization (c)

      3,067       (1,033 )      4,100  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 123,249     $ 64,021     $ 59,176  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      31.8 %      16.5 %      15.3 % 

Note: Amounts may not calculate due to rounding

 

(a)

Charges represent realignment costs incurred as a result of realignment programs of which $8,600 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.

 

 

7

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

     Year Ended December 31,  
(Amounts in thousands, except per share data)    2025     2024     2023  

Sales

    $ 4,729,260     $ 4,557,806     $ 4,320,577  

Cost of sales

      (3,147,823 )      (3,123,560 )      (3,043,749 ) 
  

 

 

    

 

 

    

 

 

  

Gross profit

      1,581,437       1,434,246       1,276,828  

Selling, general and administrative expense

      (1,062,100 )      (978,037 )      (961,169 ) 

Loss on sale of business

      —        (12,981 )      —   

Loss on divestiture of asbestos-related assets and liabilities

      (140,092 )      —        —   

Net earnings from affiliates

      20,679       19,051       17,894  
  

 

 

    

 

 

    

 

 

  

Operating income

      399,924       462,279       333,553  

Interest expense

      (77,740 )      (69,301 )      (66,924 ) 

Interest income

      7,551       5,371       6,991  

Other income (expense), net

      195,663       (12,194 )      (49,870 ) 
  

 

 

    

 

 

    

 

 

  

Earnings before income taxes

      525,398       386,155       223,750  

Provision for income taxes

      (155,596 )      (84,929 )      (18,562 ) 
  

 

 

    

 

 

    

 

 

  

Net earnings, including noncontrolling interests

      369,802       301,226       205,188  

Less: Net earnings attributable to noncontrolling interests

      (23,555 )      (18,467 )      (18,445 ) 
  

 

 

    

 

 

    

 

 

  

Net earnings attributable to Flowserve Corporation

    $ 346,247     $ 282,759     $ 186,743  
  

 

 

    

 

 

    

 

 

  

Net earnings per share attributable to Flowserve Corporation common shareholders:

       

Basic

      2.66     $ 2.15     $ 1.42  

Diluted

      2.64       2.14       1.42  

Weighted average shares – basic

      130,005       131,488       131,117  

Weighted average shares – diluted

      130,979       132,356       131,931  

 

8

Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited)

(Amounts in thousands, except per share data)

 

Twelve Months Ended December 31, 2025

    Gross
Profit		     Selling,
General &
Administrative
Expense		     Loss on
Divestiture of
Asbestos-
Related Assets
and Liabilities		     Operating
Income		     Other Income
(Expense), Net		     Provision For
(Benefit From)
Income Taxes		     Net
Earnings
(Loss)		     Effective
Tax Rate		     Diluted
EPS		  

Reported

    $ 1,581,437     $ 1,062,100     $ 140,092     $ 399,924     $ 195,663     $ 155,596     $ 346,247       29.6 %      2.64  

Reported as a percent of sales

      33.4 %      22.5 %      3.0 %      8.5 %      4.1 %      3.3 %      7.3 %     

Realignment charges (a)

      54,660       (3,595 )      —        58,255       —        13,687       44,568       23.5 %      0.34  

Acquisition related (b)(c)

      635       (13,895 )      —        14,530       —        3,417       11,113       23.5 %      0.08  

Purchase accounting step-up and intangible asset amortization (d)

      9,180       (5,200 )      —        14,380       —        4,138       10,242       28.8 %      0.08  

Discrete items (e)(f)(g)

      121       (31,412 )      —        31,533       13,064       8,609       35,988       19.3 %      0.27  

Merger transaction costs (h)

      —        (41,197 )      —        41,197       —        9,534       31,663       23.1 %      0.24  

Merger termination payment (i)

      —        —        —        —        (266,000 )      (60,957 )      (205,043 )      22.9 %      (1.57 ) 

Discrete tax items (j)

      —        —        —        —        —        (24,860 )      24,860       0.0 %      0.19  

Loss on asbestos divestiture (k)

      —        —        (140,092 )      140,092       —        2,644       137,448       1.9 %      1.05  

Below-the-line foreign exchange impacts (l)

      —        —        —        —        43,893       4,821       39,072       11.0 %      0.30  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted

    $ 1,646,033     $ 966,801     $ —      $ 699,911     $ (13,380 )    $ 116,629     $ 476,158       18.9 %      3.64  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      34.8 %      20.4 %      0.0 %      14.8 %      -0.3 %      2.5 %      10.1 %     

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 and net of a $6,888 gain associated with the divestiture of a pump product line.

(b)

Charge represents $12,790 of acquisition and integration related costs associated with the MOGAS acquisition.

(c)

Charge represents $1,740 of costs associated with merger and acquisition activity.

(d)

Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition.

(e)

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 US Qualified pension plan.

(f)

Charge includes $5,141 for a non-cash pension settlement accounting loss incurred in conjunction with the freeze of our US Qualified pension plan and $7,923 for a non-cash pension settlement accounting loss incurred in conjunction with a United Kingdom based pension plan.

(g)

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.

(h)

Charge represents transaction costs incurred associated with the terminated Chart Industries merger.

(i)

Amount represents the Chart Industries merger termination fee paid to Flowserve.

(j)

Amount represents a one-time tax charge related to enactment of the One Big Beautiful Bill Act during Q3 2025.

(k)

Charge represents the one-time loss associated with the divestiture of our asbestos-related assets and liabilities including $199,000 of cash funded to the divested entity and $8,335 of transaction costs incurred.

(l)

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.

 

Twelve Months Ended December 31, 2024

    Gross
Profit		     Selling,
General &
Administrative
Expense		     Loss 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

    $ 1,434,246     $ 978,037     $ 12,981     $ 462,279     $ (12,194 )    $ 84,929     $ 282,759       22.0 %      2.14  

Reported as a percent of sales

      31.5 %      21.5 %      0.3 %      10.1 %      -0.3 %      1.9 %      6.2 %     

Realignment charges (a)

      31,576       (4,939 )      (12,981 )      49,496       —        4,884       44,612       9.9 %      0.34  

Discrete items (b)(c)(d)

      2,700       (7,500 )      —        10,200       —        2,869       7,331       28.1 %      0.06  

Acquisition related (e)

      —        (9,944 )      —        9,944       —        2,340       7,604       23.5 %      0.06  

Discrete asset write-downs (f)(g)

      —        (1,795 )      —        1,795       3,567       1,342       4,020       25.0 %      0.03  

Purchase accounting step-up and intangible asset amortization (h)

      3,067       (1,033 )      —        4,100       —        1,300       2,800       31.7 %      0.02  

Below-the-line foreign exchange impacts (i)

      —        —        —        —        (2,302 )      (1,912 )      (390 )      83.1 %      (0.00 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted

    $ 1,471,589     $ 952,826     $ —      $ 537,814     $ (10,929 )    $ 95,752     $ 348,736       20.7 %      2.63  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      32.3 %      20.9 %      0.0 %      11.8 %      -0.2 %      2.1 %      7.7 %     

Note: Amounts may not calculate due to rounding

 

(a)

Charges represent realignment costs incurred as a result of realignment programs of which $33,700 is non-cash.

 

(b)

Charge represents a reduction to reserves of $2,000 associated with our ongoing financial exposure in Russia that were adjusted for Non-GAAP measures when established in 2022.

 

(c)

Charge represents a one-time $5,000 discretionary cash transition benefit provided to certain employees in conjunction with the freeze of our US Qualified pension plan.

 

(d)

Charge represents the $7,200 strategic acquisition of intellectual property related to certain liquefied natural gas technology.

 

(e)

Charge represents acquisition and integration related costs associated with the MOGAS acquisition.

 

(f)

Charge represents a $1,795 non-cash write-down of a software asset.

 

(g)

Charge represents a $3,567 non-cash write-down of a debt investment.

 

(h)

Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition.

 

(i)

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    Year Ended December 31,  
(Amounts in millions, except percentages)    2025     2024  

Bookings

    $ 3,273.3     $ 3,304.3  

Sales

      3,235.3       3,158.6  

Gross profit

      1,138.7       1,017.0  

Gross profit margin

      35.2 %      32.2 % 

SG&A

      558.5       556.2  

Segment operating income

      600.9       480.2  

Segment operating income as a percentage of sales

      18.6 %      15.2 % 
FLOW CONTROL DIVISION    Year Ended December 31,  
(Amounts in millions, except percentages)    2025     2024  

Bookings

    $ 1,454.3     $ 1,370.7  

Sales

      1,504.5       1,409.3  

Gross profit

      445.7       424.0  

Gross profit margin

      29.6 %      30.1 % 

SG&A

      266.0       252.7  

Loss on sale of business

      —        (13.0 ) 

Segment operating income

      179.7       158.3  

Segment operating income as a percentage of sales

      11.9 %      11.2 % 

 

10

Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited)

(Amounts in thousands)

Flowserve Pumps Division

 

Twelve Months Ended
December 31, 2025

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 1,138,712     $ 558,507     $ 600,884  

Reported as a percent of sales

      35.2 %      17.3 %      18.6 % 

Realignment charges (a)

      30,614       (3,932 )      34,546  

Discrete items (b)

      96       (323 )      419  

Acquisition related (c)

      —        (740 )      740  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 1,169,422     $ 553,512     $ 636,589  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      36.1 %      17.1 %      19.7 % 
Flow Control Division

 

Twelve Months Ended
December 31, 2025

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 445,660     $ 265,973     $ 179,687  

Reported as a percent of sales

      29.6 %      17.7 %      11.9 % 

Realignment charges (a)

      24,121       2,544       21,577  

Acquisition related (d)

      635       (12,155 )      12,790  

Purchase accounting step-up and intangible asset amortization (e)

      9,180       (5,200 )      14,380  

Discrete items (b)

      19       (294 )      313  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 479,615     $ 250,868     $ 228,747  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      31.9 %      16.7 %      15.2 % 

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 and net of a $6,888 gain associated with the divestiture of a pump product line.

 

(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 US Qualified pension plan.

 

(c)

Charge represents costs associated with merger and acquisition activity.

 

(d)

Charge represents acquisition and integration-related costs associated with the MOGAS acquisition.

 

(e)

Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition.

Twelve Months Ended
December 31, 2024

    Gross Profit     Selling,
General &
Administrative
Expense		     Operating
Income		  

Reported

    $ 1,017,048     $ 556,225     $ 480,216  

Reported as a percent of sales

      32.2 %      17.6 %      15.2 % 

Realignment charges (a)

      30,727       (1,078 )      31,805  

Discrete items (b)(c)(d)

      1,700       (6,000 )      7,700  
  

 

 

    

 

 

    

 

 

  

Adjusted

    $ 1,049,475     $ 549,147     $ 519,721  
  

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      33.2 %      17.4 %      16.5 % 

 

Twelve Months Ended
December 31, 2024

    Gross
Profit		     Selling,
General &
Administrative
Expense		     Loss on
Sale of
Business		     Operating
Income		  

Reported

    $ 423,973     $ 252,675     $ 12,981     $ 158,265  

Reported as a percent of sales

      30.1 %      17.9 %      0.9 %      11.2 % 

Realignment charges (a)

      1,077       (3,095 )      (12,981 )      17,153  

Discrete item (b)

      800       (400 )      —        1,200  

Acquisition related (e)

      —        (9,944 )      —        9,944  

Purchase accounting step-up and intangible asset amortization (f)

      3,067       (1,033 )      —        4,100  
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted

    $ 428,917     $ 238,203     $ —      $ 190,662  
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted as a percent of sales

      30.4 %      16.9 %      0.0 %      13.5 % 

Note: Amounts may not calculate due to rounding

 

(a)

Charges represent realignment costs incurred as a result of realignment programs of which $33,700 is non-cash.

 

(b)

Charge represents a one-time $3,700 discretionary cash transition benefit provided to certain employees in conjunction with the freeze of our US Qualified pension plan.

 

(c)

Charge represents a reduction to reserves of $2,000 associated with our ongoing financial exposure in Russia that were adjusted for Non-GAAP measures when established in 2022.

 

(d)

Charge represents the $7,200 strategic acquisition of intellectual property related to certain liquefied natural gas technology.

 

(e)

Charge represents acquisition and integration related costs associated with the MOGAS acquisition.

 

(f)

Charge represents amortization of step-up in value of acquired inventories and acquisition related intangible assets associated with the MOGAS acquisition.

 

 

11

Fourth Quarter and Full Year 2025 - Segment Results

 

(dollars in millions, comparison vs. 2024 fourth quarter and full year, unaudited)

 

     FPD     FCD  
     4th Qtr     Full Year     4th Qtr     Full Year  

Bookings

    $ 883.6       $ 3,273.3       $ 330.3       $ 1,454.3    

- vs. prior year

      67.2       8.2 %      -31.0       -0.9 %      -33.2       -9.1 %      83.6       6.1 % 

- on constant currency

      43.6       5.3 %      -60.0       -1.8 %      -36.5       -10.0 %      80.9       5.9 % 

Sales

    $ 833.0       $ 3,235.3       $ 391.5       $ 1,504.5    

- vs. prior year

      38.1       4.8 %      76.8       2.4 %      3.6       0.9 %      95.2       6.8 % 

- on constant currency

      14.4       1.8 %      50.7       1.6 %      -0.9       -0.2 %      90.0       6.4 % 

Gross Profit

    $ 305.2       $ 1,138.7       $ 123.5       $ 445.7    

- vs. prior year

      19.4 %        12.0 %        4.2 %        5.1 %   

Gross Margin (% of sales)

      36.6 %        35.2 %        31.5 %        29.6 %   

- vs. prior year (in basis points)

      440 bps         300 bps         100 bps         (50 ) bps   

Operating Income

    $ 166.8       $ 600.9       $ 64.0       $ 179.7    

- vs. prior year

      37.7       29.2 %      120.7       25.1 %      19.4       43.5 %      21.4       13.5 % 

- on constant currency

      31.2       24.2 %      111.7       23.3 %      19.5       43.8 %      22.6       14.3 % 

Operating Margin (% of sales)

      20.0 %        18.6 %        16.3 %        11.9 %   

- vs. prior year (in basis points)

      380 bps         340 bps         480 bps         70 bps    

Adjusted Operating Income *

    $ 174.8       $ 636.6       $ 77.2       $ 228.7    

- vs. prior year

      35.8       25.7 %      116.9       22.5 %      18.1       30.5 %      38.1       20.0 % 

- on constant currency

      29.3       21.1 %      107.9       20.8 %      18.2       30.7 %      39.3       20.6 % 

Adj. Oper. Margin (% of sales)*

      21.0 %        19.7 %        19.7 %        15.2 %   

- vs. prior year (in basis points)

      350 bps         320 bps         440 bps         170 bps    

Backlog

    $ 2,044.8           $ 828.6        

 

*

Adjusted Operating Income and Adjusted Operating Margin exclude realignment charges and other specific discrete items

 

12

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(Amounts in thousands, except par value)    December 31,
2025		     December 31,
2024		  

ASSETS

     

Current assets:

     

Cash and cash equivalents

    $ 760,183     $ 675,441  

Accounts receivable, net of allowance for expected credit losses of $83,094 and $79,059, respectively

      1,029,095       976,739  

Contract assets, net

      322,472       298,906  

Inventories

      789,898       837,254  

Prepaid expenses and other

      141,237       116,157  
  

 

 

    

 

 

  

Total current assets

      3,042,885       2,904,497  

Property, plant and equipment, net

      566,751       539,703  

Operating lease right-of-use assets, net

      166,031       159,400  

Goodwill

      1,391,988       1,286,295  

Deferred taxes

      156,250       221,742  

Other intangible assets, net

      198,475       188,604  

Other assets, net

      185,820       200,580  
  

 

 

    

 

 

  

Total assets

    $ 5,708,200     $ 5,500,821  
  

 

 

    

 

 

  

LIABILITIES AND EQUITY

     

Current liabilities:

     

Accounts payable

    $ 554,243     $ 545,310  

Accrued liabilities

      587,475       561,486  

Contract liabilities

      274,669       283,670  

Debt due within one year

      49,868       44,059  

Operating lease liabilities

      35,630       33,559  
  

 

 

    

 

 

  

Total current liabilities

      1,501,885       1,468,084  

Long-term debt due after one year

      1,525,210       1,460,132  

Operating lease liabilities

      149,565       149,838  

Retirement obligations and other liabilities

      277,216       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

      508,890       502,045  

Retained earnings

      4,261,977       4,025,750  

Treasury shares, at cost – 49,763 and 45,688 shares, respectively

      (2,231,685 )      (2,007,869 ) 

Deferred compensation obligation

      6,629       8,172  

Accumulated other comprehensive loss

      (575,405 )      (741,424 ) 
  

 

 

    

 

 

  

Total Flowserve Corporation shareholders’ equity

      2,191,397       2,007,665  

Noncontrolling interests

      62,927       44,047  
  

 

 

    

 

 

  

Total equity

      2,254,324       2,051,712  
  

 

 

    

 

 

  

Total liabilities and equity

    $ 5,708,200     $ 5,500,821  
  

 

 

    

 

 

  

 

13

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

     Year Ended December 31,  
(Amounts in thousands)    2025     2024     2023  

Cash flows – Operating activities:

       

Net earnings, including noncontrolling interests

    $ 369,802     $ 301,226     $ 205,188  

Adjustments to reconcile net earnings to net cash provided by operating activities

      —       

Depreciation

      79,236       75,849       73,464  

Amortization of intangible and other assets

      16,218       9,749       10,283  

Loss on sale of business

      —        12,981       —   

Loss on sale of asbestos-related assets and liabilities

      140,092       —        —   

Contribution to divest asbestos-related assets and liabilities

      (199,000 )      —        —   

Stock-based compensation

      38,263       30,474       27,808  

Foreign currency, asset write downs and other non-cash adjustments

      (15,226 )      24,172       (17,331 ) 

Change in assets and liabilities, net of businesses acquired:

       

Accounts receivable, net

      691       (82,188 )      4,744  

Inventories

      86,678       38,872       (59,831 ) 

Contract assets, net

      (13,279 )      (18,513 )      (41,149 ) 

Prepaid expenses and other assets, net

      (56,489 )      15,116       7,825  

Accounts payable

      (28,852 )      (12,336 )      53,065  

Contract liabilities

      (23,502 )      (6,070 )      26,837  

Accrued liabilities

      25,210       49,578       59,213  

Retirement obligations and other

      38,088       1,456       38,497  

Net deferred taxes

      47,954       (15,058 )      (62,841 ) 
  

 

 

    

 

 

    

 

 

  

Net cash flows provided by operating activities

      505,884       425,308       325,772  
  

 

 

    

 

 

    

 

 

  

Cash flows – Investing activities:

       

Capital expenditures

      (70,927 )      (81,019 )      (67,359 ) 

Payments for acquisitions, net of cash acquired

      (65,881 )      (305,924 )      —   

Proceeds from disposal of assets

      11,551       2,244       2,057  

Payments for disposition of business

      —        (2,555 )      —   

Net affiliate investment activity

      96       40       (3,278 ) 
  

 

 

    

 

 

    

 

 

  

Net cash flows used by investing activities

      (125,161 )      (387,214 )      (68,580 ) 
  

 

 

    

 

 

    

 

 

  

Cash flows – Financing activities:

       

Payments on term loan

      (37,500 )      (95,375 )      (40,000 ) 

Proceeds from term loan

      —        366,000       —   

Proceeds under revolving credit facility

      200,000       100,000       280,000  

Payments under revolving credit facility

      (100,000 )      (100,000 )      (280,000 ) 

Proceeds under other financing arrangements

      15,309       1,437       1,114  

Payments under other financing arrangements

      (5,888 )      (1,455 )      (2,604 ) 

Payments related to tax withholding for stock-based compensation

      (11,754 )      (9,581 )      (6,245 ) 

Repurchases of common shares

      (254,860 )      (20,070 )      —   

Payments of dividends

      (109,639 )      (110,440 )      (104,955 ) 

Contingent consideration payment related to acquired business

      (15,000 )      —        —   

Other

      (7,596 )      (13,021 )      (324 ) 
  

 

 

    

 

 

    

 

 

  

Net cash flows provided (used) provided by financing activities

      (326,928 )      117,495       (153,014 ) 

Effect of exchange rate changes on cash

      30,947       (25,826 )      6,529  
  

 

 

    

 

 

    

 

 

  

Net change in cash and cash equivalents

      84,742       129,763       110,707  

Cash and cash equivalents at beginning of period

      675,441       545,678       434,971  
  

 

 

    

 

 

    

 

 

  

Cash and cash equivalents at end of period

    $ 760,183     $ 675,441     $ 545,678  
  

 

 

    

 

 

    

 

 

  

Supplemental Cash Flow Information:

       

Income taxes paid (net of refunds)

    $ 92,327     $ 81,172     $ 119,275  

Interest paid

      75,472       66,809       64,865  

Non-Cash Investing and Financing Activities:

       

Contingent liabilities incurred related to acquired business, but not paid

    $ 674     $ 15,000     $ —   

 

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 Contacts:

 

Brian Ezzell, Vice President, Investor Relations, Treasurer & Corporate Finance

      (469) 420-3222  

Olivia Webb, Director, Investor Relations

      (469) 420-3223  

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 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.

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

EXHIBIT 99.2

 

LOGO

Flowserve Expands Leadership in Nuclear and Other Power End

Markets with Strategic Acquisition of Trillium Flow Technologies’

Valves Division

 

  •  

Acquisition accelerates power end-market growth strategy, with complementary offerings for nuclear and traditional power generation markets

 

  •  

Strengthens valve and actuation product portfolio with mission-critical flow control solutions

 

  •  

Enhances service capabilities and expands global installed base with high aftermarket entitlement

 

  •  

Expected to be accretive to adjusted operating income in 2026

DALLAS—(BUSINESS WIRE)—February 5, 2026—Flowserve Corporation (NYSE: FLS) (“Flowserve” or the “Company”), a leading provider of flow control products and services for the global infrastructure markets, has signed a definitive agreement to acquire Trillium Flow Technologies’ Valves Division1 (“TVD”), a market leading provider of highly engineered mission-critical valves used in nuclear and traditional power generation, industrial, and critical infrastructure applications for $490 million in cash (the “Transaction”). The Transaction is expected to close mid-year 2026.

TVD’s comprehensive portfolio of brands serves a global customer base across attractive and growing end markets with a nearly 200-year legacy of engineering excellence and reliable performance. The acquisition will expand Flowserve’s reach in both conventional and emerging markets by integrating TVD’s highly specialized valve and actuation product portfolio, differentiated power and nuclear technology, and scalable service offerings.

TVD’s large installed base of over 200,000 units, including assets in 115 operating nuclear reactors, generates recurring, high-margin demand for aftermarket services, replacements, and spare parts. Adding TVD’s portfolio strengthens Flowserve’s leading nuclear position—supporting more than 300 reactors worldwide—and enhances the Company’s ability to serve existing nuclear assets while delivering a broad range of flow control solutions for new traditional and small modular reactors.

“TVD’s products and capabilities are highly complementary to our portfolio and will enhance our ability to meet future demand in nuclear, traditional power, and more broadly across the industrial landscape,” said Scott Rowe, Flowserve President and Chief Executive Officer. “We see strong aftermarket potential from their global installed base that is expected to drive profitable growth. The acquisition underscores our commitment to building a more cycle-resilient business and will enhance value for shareholders, customers, and associates. We look forward to welcoming the Trillium Valves team to Flowserve.“

Transaction Details and Approvals

The purchase price of $490 million represents a multiple of approximately 12.3x TVD’s 2025 adjusted EBITDA, excluding the impact of anticipated synergies. TVD is expected to have annualized revenues of approximately $200 million with adjusted EBITDA margins in the high teens. The Company anticipates leveraging the Flowserve Business System to increase TVD’s margins over time.

The Transaction is expected to be accretive to adjusted operating income in 2026, excluding anticipated synergies.

Flowserve expects to fund the Transaction through a combination of cash on hand and additional debt. The Transaction is subject to the satisfaction of customary closing conditions and regulatory approvals.

Advisors

Goldman Sachs & Co LLC is serving as exclusive financial advisor and Baker McKenzie is serving as legal advisor to Flowserve. J.P. Morgan Securities LLC is serving as financial advisor and Freshfields is serving as legal advisor to TVD.

 

1 

Transaction excludes Trillium Valves’ French operations.

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.

###

Investor Contacts

Brian Ezzell, Vice President, Investor Relations, Treasurer & Corporate Finance    (469) 420-3222
Olivia Webb, Director, Investor Relations    (469) 420-3223

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 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.

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.

###