The following is a summary of the Flowserve Corporation (FLS) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Flowserve reported Q1 revenue of almost $1.1 billion, an 11% increase year-over-year.

• Adjusted gross margin exceeded expectations at 31.7%.

• Adjusted operating income margin improved by 260 basis points year-over-year, reaching 10.9%.

• Adjusted earnings per share of $0.58 reflect an increase of 45% from Q1 of 2023.

• Full-year adjusted EPS guidance range uplifted to $2.50 to $2.70, indicating a near 24% increase year-over-year at the midpoint.

• Company reported a record Q1 operating cash flow of $62 million.

Business Progress:

• Over 1,100 associates trained as part of the operational excellence program.

• Bookings in Q1 close to $1.04 billion across all industries.

• Two large project awards in April exceeding $150 million to support the aggressive capital build-out in Saudi Arabia.

• Plans to capitalize on anticipated growth related to capacity expansion and new generation in the power sector.

• The forecasted full-year book-to-bill ratio for 2024 to exceed 1.0.

• Company is focusing more on specialty chemical, water, and new energy technologies like hydrogen.

• Achieved record-breaking free cash flow for the quarter and improved working capital with a target of hitting 25-27% as a percentage of sales.

• Flowserve achieved growth and healthy margins in projects using a selective bidding process.

• The company is well-prepared for growth in the European markets and sees its participation in decarbonization and energy security as the start of a multi-year up cycle.

• New initiatives, like power projects in Europe and the Americas, expected to fuel growth.

• Portfolio optimization ongoing to diversify offerings and align with the decarbonization trend in the markets.

• Plans to consolidate operations as part of operational excellence program.

• Investment optimism expressed for long-term prospects in Asia Pacific, especially in China.

• Company aims to maintain a balanced growth profile between OE and aftermarket while being selective in large OE projects.

More details: Flowserve IR

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