Slide 1: First Quarter 2023 Earnings Conference Call
FIRST QUARTER 2023 EARNINGS CONFERENCE CALL May 2, 2023 Q1 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: Q1 2023 Highlights
Q1 2023 Highlights Strong revenue growth of 19% combined with systemic operational improvements drove Adjusted EPS* of $0.40, the highest first quarter since 2019 Bookings of $1.06 billion represent the fifth consecutive quarter over $1 billion Driven by strong Aftermarket, MRO and 3D strategy Adjus
Slide 4: Q1 2023 Overview
Q1 2023 Overview BOOKINGS SALES $ millions $ millions $1,086 $1,107 MRO and Aftermarket bookings at Revenue increased 19.4% versus $1,057 $1,039 near record levels $980 prior year, or 22.3% on a constant $821 currency basis - AM bookings of $550 million marked the 6th consecutive - Expect full-year
Slide 5: Q1 2023 Bookings Mix
Q1 2023 Bookings Mix OIL & GAS – 37% ORIGINAL EQUIPMENT • LNG projects progressing through FID $ millions • Significant spending to maintain downstream assets • Decarbonization becoming a top priority for operators $544 $556 $507 CHEMICAL – 23% 50% 50% 48% • International project activity continues
Slide 6: Q1 2023 Sales Mix
Q1 2023 Sales Mix ORIGINAL EQUIPMENT Europe-18% $ millions 17% Revenue Growth $500 $464 $383 47% 48% 47% 2022 Q1 2022 Q4 2023 Q1 North America-42% 18% Revenue Growth Asia Pacific-18% 13% Revenue Growth AFTERMARKET $ millions Latin America-7% Middle East $539 37% Revenue Growth & Africa-15% $517 58%
Slide 7: Q1 2023 Segment Highlights
Q1 2023 Segment Highlights FPD FCD As Reported Year-over-Year As Reported Year-over-Year Bookings $728.5 -8.4% $332.0 12.8% Adjusted Gross Margin* 31.9% +310 bps 28.5% +410 bps Adjusted SG&A as % of Sales* 20.3% -240 bps 17.7% +30 bps Adjusted Operating Margin* 12.2% +540 bps 10.8% +380 bps Book-to-
Slide 8: 2023 Guidance
[1] 2023 Guidance Revised 2023 Prior 2023 [1] Guidance Metric 2023 GUIDANCE COMMENTS Guidance Guidance Revenue Growth Up 10.0% - 12.0% Up 9.0% - 11.0% Revenue growth supported by $2.8 billion backlog and expectation that markets remain Reported EPS [2] $1.40 - $1.65 $1.40 - $1.65 supportive [3] Infl
Slide 9: Flowserve 3D Growth Strategy in Action
Flowserve 3D Growth Strategy in Action DIVERSIFICATION DECARBONIZATION DIGITIZATION Diversify – Seal Technology Enabling Decarbonize – Progress to Net Zero Digitize – Providing Clean, Reliable Hydrogen Compression Through Direct Air Capture Power with RedRaven Seals to be utilized in Eastern Europe
Slide 10: Key Takeaways and 2023 Outlook
Key Takeaways and 2023 Outlook Improved operating performance drives strong Q1 results 3D strategy positioning Flowserve exceptionally well to capitalize on existing market conditions Substantial backlog and high run rate business supports multi-year revenue growth Cost action plan to offset inflati
Slide 11: Earnings Conference Call
Q1 2023 Earnings Conference Call 11
Slide 12: Appendix
Appendix Q1 2023 Earnings Conference Call 12
Slide 13: Q1 2023 Consolidated Financial Results
Q1 2023 Consolidated Financial Results 1st Quarter 1st Quarter Adjusted 2023 2023 2022 ($ m illions) 2023 2022 Delta ($) Delta (%) Constant Adjusted Adjusted Adjusted Delta ($) Delta (%) Constant FX(%)* Items Results Results FX(%)* Bookings $ 1,057.2 $ 1,086.1 $ (28.9) -2.7% -0.5% $ - $ 1,057.2 $ 1,
Slide 14: Flowserve Pump Division Q1 2023 Segment Results
Flowserve Pump Division Q1 2023 Segment Results 1st Quarter Constant ($ m illions) 2023 2022 Delta ($) Delta (%) FX(%)* Bookings $ 728.5 $ 795.6 $ (67.1) -8.4% -6.6% Sales $ 700.1 $ 575.6 $ 124.5 21.6% 24.4% Gross Profit $ 221.4 $ 156.9 $ 64.5 41.1% Gross Margin (%) 31.6% 27.3% 430 bps SG&A $ 147.0
Slide 15: Flowserve Pump Division Q1 2023 Bookings and Sales
Flowserve Pump Division Q1 2023 Bookings and Sales 1st Quarter Constant ($ m illions) 2023 2022 Delta (%) FX(%)* 253 324 -22% -20% OE Bookings Mix 35% 41% (600) bps ** 1% 3% 476 472 AM 65% 59% 600 bps 253 201 26% 29% OE 36% 35% 100 bps Sales Mix ** 447 375 19% 22% AM 64% 65% (100) bps * Constant FX
Slide 16: Flow Control Division Q1 2023 Segment Results
Flow Control Division Q1 2023 Segment Results 1st Quarter Constant ($ m illions) 2023 2022 Delta ($) Delta (%) FX(%)* Bookings $ 332.0 $ 294.3 $ 37.7 12.8% 15.7% Sales $ 281.6 $ 247.9 $ 33.7 13.6% 16.7% Gross Profit $ 80.3 $ 59.5 $ 20.8 35.0% Gross Margin (%) 28.5% 24.0% 450 bps SG&A $ 61.8 $ 44.3 $
Slide 17: Flow Control Division Q1 2023 Bookings and Sales
Flow Control Division Q1 2023 Bookings and Sales 1st Quarter Constant ($ m illions) 2023 2022 Delta (%) FX(%)* 256 221 16% 19% OE Bookings Mix 77% 75% 200 bps ** 4% 6% 76 73 AM 23% 25% (200) bps 211 184 15% 18% OE 75% 74% 100 bps Sales Mix ** 70 64 9% 11% AM 25% 26% (100) bps * Constant FX represent
Slide 18: Investor Relations Contacts
Investor Relations Contacts Jay Roueche Mike Mullin 972.443.6560 214.697.8568 jroueche@flowserve.com mmullin@flowserve.com Q1 2023 Earnings Conference Call 18