Slide 1: Third Quarter 2018 Earnings Conference Call
Third Quarter 2018 Earnings Conference Call November 8, 2018 Quarterly Presentation 2017 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: Q3 2018 Overview
Q3 2018 Overview • Q3 2018 Reported and Adjusted earnings per share of $0.21 and $0.49 - Adjusted EPS* excludes approximately $47 million of items consisting primarily of realignment and transformation expenses, loss on a sale of assets and below-the-line foreign exchange expenses • Bookings increas
Slide 4: Q3 Bookings & Sales Mix
Q3 Bookings & Sales Mix End-Markets Bookings Sales • Oil & Gas $1.01B $893M $953M $883M • Global MRO spend increased on refinery maintenance and efficiency upgrades • Downstream brownfield projects improved on clean fuels investment where Flowserve’s product mix is favorable 38% • North America and
Slide 5: Q3 Original Equipment / Aftermarket Mix
Q3 Original Equipment / Aftermarket Mix Original Equipment Aftermarket Bookings Mix % Sales Mix % Bookings Mix % Sales Mix % $ millions $ millions $ millions $ millions $533 $507 $504 $496 $488 $504 $485 $454 $457 $444 $439 $439 51% 50% 50% 52% 49% 51% 48% 50% 50% 50% 50% 49% 2018 Q3 2018 Q2 2017 Q3
Slide 6: Q3 2018 Financial Scorecard
[1] Q3 2018 Financial Scorecard [2] Bookings Revenue Adjusted OI% Adjusted EPS Oper. Cash Flow PWC $ millions $ millions $0.49 $ millions As a % of TTM Revenue $1,037 11.0% $1,010 $83 $0.41 31.6% $973 $0.37 30.1% $953 9.3% 9.4% 28.9% $64 $893 $883 $26 2018 Q3 2018 Q2 2017 Q3 2018 Q3 2018 Q2 2017 Q3
Slide 7: 2018 Guidance Assumptions
2018 Guidance Assumptions 2018 Updated Guidance Assumptions 2018 Prior Guidance Guidance [1] [2] Revenue Guidance 3% - 6% 5% - 7% Reported EPS Guidance $0.95 - $1.15 $0.75 - $0.85 [3] Adjusted EPS Guidance $1.50 - $1.70 $1.65 - $1.75 EUR Rate 1.22 2018 Q4 - 1.15 Adjusted Tax Rate 27% - 28% 27% - 28%
Slide 8: Flowserve 2.0 Transformation
Flowserve 2.0 Transformation Operations REDUCE COMPLEXITY Growth Commercial ACCELERATE GROWTH Organizational Health OPERATIONAL EXCELLENCE Cost Aftermarket Structure FLOWSERVE OPERATING Working MODEL Capital Flowserve Q3 2018 Earnings Conference Call 8
Slide 9: Questions & Answers
Questions & Answers Flowserve Q3 2018 Earnings Conference Call 9
Slide 10: Appendix
Appendix Flowserve Q3 2018 Earnings Conference Call 10
Slide 11: Q3 2018 Consolidated Financial Results
Q3 2018 Consolidated Financial Results 3rd Quarter 3rd Quarter Adjusted 2018 2018 2017 Constant Constant ($ millions) 2018 2017 Delta ($) Delta (%) FX(%)* Adjusted Adjusted Adjusted Delta ($) Delta (%) FX(%)* Items Results Results Bookings $ 1,010.4 $ 892.9 $ 117.5 13.2% 14.1% $ - $ 1,010.4 $ 892.9
Slide 12: Year-to-Date 2018 Consolidated Financial Results
Year-to-Date 2018 Consolidated Financial Results Year-to-Date Year-to-Date Adjusted 2018 2018 2017 Constant Constant ($ millions) 2018 2017 Delta ($) Delta (%) FX(%)* Adjusted Adjusted Adjusted Delta ($) Delta (%) FX(%)* Items Results Results Bookings $ 2,974.5 $ 2,820.1 $ 154.4 5.5% 3.5% $ 2,974.5
Slide 13: Engineered Product Division Q3 2018 Segment Results
Engineered Product Division Q3 2018 Segment Results 3rd Quarter Year-to-Date Constant Constant ($ millions) 2018 2017 Delta ($) Delta (%) FX(%)* 2018 2017 Delta ($) Delta (%) FX(%)* Bookings $ 519.8 $ 432.5 $ 87.3 20.2% 20.9% $ 1,450.3 $ 1,357.2 $ 93.1 6.9% 5.3% Sales $ 466.2 $ 424.2 $ 42.0 9.9% 10.
Slide 14: Engineered Product Division Q3 2018 Bookings and Sales
Engineered Product Division Q3 2018 Bookings and Sales 3rd Quarter Year-to-Date Constant Constant ($ millions) 2018 2017 Delta (%) 2018 2017 Delta (%) FX(%)* FX(%)* $ 156 $ 114 37% 37% $ 402 $ 402 0% -2% OE 30% 26% 400 bps 28% 30% (200) bps Bookings Mix ** $ 364 $ 319 14% 15% $ 1,048 $ 955 10% 8% AM
Slide 15: Industrial Product Division Q3 2018 Segment Results
Industrial Product Division Q3 2018 Segment Results 3rd Quarter Year-to-Date Constant Constant ($ millions) 2018 2017 Delta ($) Delta (%) FX(%)* 2018 2017 Delta ($) Delta (%) FX(%)* Bookings $ 199.8 $ 196.9 $ 2.9 1.5% 2.4% $ 633.2 $ 616.6 $ 16.6 2.7% -0.1% Sales $ 199.1 $ 189.7 $ 9.4 5.0% 6.1% $ 603
Slide 16: Industrial Product Division Q3 2018 Bookings and Sales
Industrial Product Division Q3 2018 Bookings and Sales 3rd Quarter Year-to-Date Constant Constant ($ millions) 2018 2017 Delta (%) 2018 2017 Delta (%) FX(%)* FX(%)* $ 120 $ 121 -1% -1% $ 389 $ 388 0% -2% OE 60% 61% (100) bps 61% 63% (200) bps Bookings Mix ** $ 80 $ 76 6% 7% $ 244 $ 229 7% 4% AM 40%
Slide 17: Flow Control Division Q3 2018 Segment Results
Flow Control Division Q3 2018 Segment Results 3rd Quarter Year-to-Date Constant Constant ($ millions) 2018 2017 Delta ($) Delta (%) FX(%)* 2018 2017 Delta ($) Delta (%) FX(%)* Bookings $ 314.2 $ 285.9 $ 28.3 9.9% 11.3% $ 957.9 $ 911.2 $ 46.7 5.1% 3.1% Sales $ 306.2 $ 287.7 $ 18.5 6.4% 7.9% $ 889.9 $
Slide 18: Flow Control Division Q3 2018 Bookings and Sales
Flow Control Division Q3 2018 Bookings and Sales 3rd Quarter Year-to-Date Constant Constant ($ millions) 2018 2017 Delta (%) 2018 2017 Delta (%) FX(%)* FX(%)* $ 240 $ 215 12% 13% $ 722 $ 693 4% 0% OE 76% 75% 100 bps 75% 76% (100) bps Bookings Mix ** $ 74 $ 71 4% 8% $ 236 $ 218 8% 14% AM 24% 25% (100
Slide 19: Investor Relations Contacts
Investor Relations Contacts Jay Roueche Mike Mullin 972.443.6560 972.443.6636 jroueche@flowserve.com mmullin@flowserve.com Flowserve Q3 2018 Earnings Conference Call 19