Slide 1: New York Analyst Meetings
New York Analyst Meetings Scott Rowe, President & Chief Executive Officer SEPTEMBER 27, 2017 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation 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
Slide 3: Company Overview
Company Overview 3
Slide 4: Key Messages and Investment Highlights
Key Messages and Investment Highlights (NYSE: FLS) Distinguished history of flow control expertise Breadth and depth of product and services offering Significant installed base provides recurring aftermarket opportunities Energy end markets appear at, or near, bottom of the cycle Transforming Flowse
Slide 5: A Comprehensive, Pure-play Flow Control Company
A Comprehensive, Pure-play Flow Control Company With a Heritage of More Than 220 Years Investor Presentation 2017 5
Slide 6: Flowserve by the Numbers
Flowserve by the Numbers ~17,000 Over 50 Over 50 Leading Employees Countries Product Brands 2+ million pumps 183 10,000+ (installed base) Aftermarket QRCs Customers Annually (Quick Response Centers) By combining global reach with a personalized local presence, each day our products, services & solut
Slide 7: New Leadership Team in Place
New Leadership Team in Place Creating a blend of veteran staff and new members Scott Rowe President & CEO Kim Jackson David Wilson Kirk Wilson John Lenander President, EPD President, IPD President, AMSS President, FCD Marketing & Technology Supply Chain Operational Excellence Combining veteran Flows
Slide 8: Platform Alignment
Platform Alignment Platforms aligned around products, services and customer buying process Scott Rowe President & CEO Kim Jackson David Wilson Kirk Wilson John Lenander President, EPD President, IPD President, AMSS President, FCD Marketing & Technology Highly- Pre-configured Engineered Engineered en
Slide 9: Functional Leadership
Functional Leadership Provide Enterprise-wide leverage and subject matter expertise Scott Rowe President & CEO Kim Jackson David Wilson Kirk Wilson John Lenander President, EPO President, IPD President, AMSS President, FCD Marketing & Technology Drive new sources of growth through market analytics a
Slide 10: Hurricane Harvey Recovery
Hurricane Harvey Recovery • Flowserve has ~400 employees located in the region • Significant aftermarket presence exists in the Gulf Coast serving refineries and chemical facilities – QRCs located in Houston, Pasadena, Corpus Christi, Angleton and Beaumont/Port Arthur • As our customers restart norm
Slide 11: Market Outlook
Market Outlook 11
Slide 12: Industries Served
Industries Served Oil & Gas Power Generation Chemical Flowserve Corporation 2017 Renewable / Water Resources Alternative Energy General Industry Investor Presentation 2017 12
Slide 13: Diversified Business Model
Diversified Business Model Latin America IPD Middle East & Africa North Geographic America Segment Exposure EPD Breakdown Asia 2016 2016 Pacific Sales - $4.0B Sales - $4.0B FCD Europe General Industries Oil & Gas Energy-focused Diverse End Markets OE OE / AM Mix Water AM 2016 2016 Sales - $4.0B Book
Slide 14: Industrial Capex Spend
Industrial Capex Spend Historical investment in capacity Oil & Gas Chemical $800,000 $40,000 $700,000 $35,000 $600,000 $30,000 $500,000 $25,000 Capex $MM Capex $MM $400,000 $20,000 $300,000 $15,000 $200,000 $10,000 $100,000 $5,000 $0 $0 Power Generation General Industries $7,000 $300,000 $6,000 $250
Slide 15: Industrial Market Cycles
Industrial Market Cycles Cycle appears at, or near, the bottom Capital Expenditure (YoY % change) 40% 30% 20% 10% 0% -10% -20% -30% Oil & Gas Chemical Power Generation General Industry Source: S&P CapitalIQ, Oxford Economics and Flowserve internal estimates Investor Presentation 2017 15
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Slide 17: Transforming the Organization
Transforming the Organization Repositioning through the cycle Legacy Flowserve The operating model worked well Flowserve 2.0 during the last period of expansion: • Resetting organization for • Decentralized operations current market environment • Empowered local organizations Bookings • Responsive t
Slide 18: Flowserve 2.0
Flowserve 2.0 Realignment • Continue pursuit of optimized manufacturing footprint • Accelerate the program and move to normal operations Flowserve Operating System • Create and implement a consistent operating model • Pursue common global systems • Centralize approach to manufacturing and supply cha
Slide 19: Flowserve 2.0
Flowserve 2.0 REDUCED Realignment STRUCTURAL • Continue pursuit of optimized manufacturing footprint COST • Accelerate the program and move to normal operations Flowserve Operating System CONSISTENT • Create and implement a consistent operating model FINANCIAL • Pursue common global systems PERFORMA
Slide 20: Financial Principles
Financial Principles Investor Presentation 2017 20
Slide 21: Financial Principles
Financial Principles Creating Long-term Shareholder Value • Return capital to shareholders • Capital to drive organic growth • Disciplined approach to portfolio management • Remain investment grade Invest with a shareholders’ perspective Investor Presentation 2017 21
Slide 22: Key Messages and Investment Highlights
Key Messages and Investment Highlights (NYSE: FLS) Distinguished history of flow control expertise Breadth and depth of product and services offering Significant installed base provides recurring aftermarket opportunities Energy end markets appear at, or near, bottom of the cycle Transforming Flowse
Slide 23: Investor Relations Contacts
Investor Relations Contacts Jay Roueche Mike Mullin 972.443.6560 972.443.6636 jroueche@flowserve.com mmullin@flowserve.com 23