Slide 1: Second Quarter 2023 Earnings Conference Call
SECOND QUARTER 2023 EARNINGS CONFERENCE CALL August 2, 2023 Q2 2023 Earnings Conference Call 1
Slide 2: Forward Looking Statements and Non-GAAP Measures
FORWARD LOOKING STATEMENTS AND NON-GAAP MEASURES 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
Slide 3: Q2 2023 Highlights
Q2 2023 Highlights Leveraged strong revenue growth of 22.5% to drive Adjusted EPS* of $0.52 Bookings of $1.11 billion marks the sixth consecutive quarter over $1 billion Driven primarily by 12.3% aftermarket growth Adjusted gross margins* increased 190 bps to 30.3% versus prior year Adjusted operati
Slide 4: Q2 2023 Overview
Q2 2023 Overview BOOKINGS SALES $ millions $ millions $1,111 MRO and Aftermarket bookings Revenue increased 22.5% versus $1,044 $1,057 $1,080 continued at near record levels $980 prior year – Highest revenue level $882 since 2015 - Record AM bookings of $591 million marked the 7th - Expect full-year
Slide 5: Q2 2023 Bookings Mix
Q2 2023 Bookings Mix OIL & GAS – 37% ORIGINAL EQUIPMENT • Multi-year investment cycle driven by international activity $ millions • LNG outlook remains elevated on the back of energy security • Downstream MRO and aftermarket spending to support higher asset utilization $518 $520 • Decarbonization ef
Slide 6: Q2 2023 Sales Mix
Q2 2023 Sales Mix ORIGINAL EQUIPMENT Europe - 18% $ millions 19% Revenue Growth $518 $464 $411 47% 47% 48% 2022 Q2 2023 Q1 2023 Q2 North America - 43% 20% Revenue Growth Asia Pacific - 17% 7% Revenue Growth AFTERMARKET $ millions Latin America - 7% Middle East $563 & Africa - 15% $517 32% Revenue Gr
Slide 7: Q2 2023 Segment Highlights
Q2 2023 Segment Highlights FPD FCD As Reported Year-over-Year As Reported Year-over-Year Bookings $760.0 5.9% $359.7 9.0% Adjusted Gross Margin* 29.9% -10 bps 30.3% +30 bps Adjusted SG&A as % of Sales* 17.2% -420 bps 17.0% -50 bps Adjusted Operating Margin* 13.2% +380 bps 13.3% +80 bps Book-to-Bill
Slide 8: 2023 Guidance
[1] 2023 Guidance Revised 2023 Prior 2023 Guidance Metric Guidance Guidance Revenue Growth Up 16.0% - 18.0% Up 10% - 12.0% Reported EPS $1.40 - $1.65 $1.40 - $1.65 [2] Adjusted EPS $1.85 - $2.00 $1.65 - $1.85 [3] EUR Rate Current Levels ~1.10 Adjusted Tax Rate ~20% 18% - 20% Capital Expenditures $75
Slide 9: Flowserve 3D Growth Strategy in Action
Flowserve 3D Growth Strategy in Action DIVERSIFICATION DECARBONIZATION DIGITIZATION Diversify – Feeding the World Decarbonize – Increasing Renewable Digitize – Delivering Reliable World Through Innovative Applications Capabilities in Europe Class Capabilities Supplying liquid ring vacuum pumps to su
Slide 10: Recent ESG Report Highlights
Recent ESG Report Highlights Core Climate Culture Responsibility Climate outlines our commitment Culture is rooted in our belief that Core Responsibility represents to enabling a clean energy future the collective energy of our people how we conduct business ethically and is embedded in our operatio
Slide 11: Key Takeaways and 2023 Outlook
Key Takeaways and 2023 Outlook Consistent and improving operating performance driving strong revenue and earnings growth allowing Flowserve to upgrade full year guidance for the second time this year 3D strategy continues to position Flowserve exceptionally well to capitalize on the existing market
Slide 12: Q2 2023 Earnings Conference Call
Q2 2023 Earnings Conference Call 12
Slide 13: Appendix
Appendix Q2 2023 Earnings Conference Call 13
Slide 14: Q2 2023 Consolidated Financial Results
Q2 2023 Consolidated Financial Results Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands, except per share data) Selling, Other General & Income Net Gross Administrative Operating (Expense), Income Earn
Slide 15: YTD 2023 Consolidated Financial Results
YTD 2023 Consolidated Financial Results Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands, except per share data) Selling, Other General & Income Net Gross Administrative Operating (Expense), Income Ear
Slide 16: Q2 2022 Consolidated Financial Results
Q2 2022 Consolidated Financial Results Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands, except per share data) Selling, Other General & Income Net Gross Administrative Operating (Expense), Income Earn
Slide 17: YTD 2022 Consolidated Financial Results
YTD 2022 Consolidated Financial Results Consolidated Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands, except per share data) Selling, Other General & Income Net Gross Administrative Operating (Expense), Income Ear
Slide 18: Flowserve Pump Division Q2 2023 Segment Results
Flowserve Pump Division Q2 2023 Segment Results Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands) Flowserve Pump Division Selling, Selling, General & General & Gross Administrative Operating Gross Administr
Slide 19: Flowserve Pump Division YTD 2023 Segment Results
Flowserve Pump Division YTD 2023 Segment Results Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands) Flowserve Pump Division Selling, Selling, General & General & Gross Administrative Operating Gross Administ
Slide 20: Flow Control Division Q2 2023 Segment Results
Flow Control Division Q2 2023 Segment Results Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands) Flow Control Division Selling, Selling, General & General & Gross Administrative Operating Gross Administrativ
Slide 21: Flow Control Division YTD 2023 Segment Results
Flow Control Division YTD 2023 Segment Results Segment Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measure (Unaudited) (Amounts in thousands) Flow Control Division Selling, Selling, General & General & Gross Administrative Operating Gross Administrati
Slide 22: Q2 2023 Bookings and Sales Mix
Q2 2023 Bookings and Sales Mix Flowserve Pump Division Constant Constant ($ m illions) Q2 2023 Q2 2022 Delta (%) FX(%)* YTD 2023 YTD 2022 Delta (%) FX(%)* Bookings Mix ** OE 251 263 -5% -6% 503 587 -14% -14% 33% 37% (400) bps 34% 39% (500) bps AM 509 455 12% 13% 985 926 6% 8% 67% 63% 400 bps 66% 61%
Slide 23: Investor Relations Contacts
Investor Relations Contacts Jay Roueche Mike Mullin 972.443.6560 214.697.8568 jroueche@flowserve.com mmullin@flowserve.com Q2 2023 Earnings Conference Call 23