Flowserve (FLS) came out with quarterly earnings of $0.72 per share, beating the Zacks Consensus Estimate of $0.59 per share. This compares to earnings of $0.58 per share a year ago. These figures are adjusted for non- recurring items. This quarterly report represents an earnings surprise of 22.03%. A quarter ago, it was expected that this company that makes pumps, valves and other parts for the oil and gas industries would post earnings of $0.77 per share when it actually produced earnings of $0.70, delive ...

Financial Performance - First quarter bookings reached $1.2 billion, with record aftermarket bookings of nearly $690 million[5] - Power bookings increased over 45% year-over-year, including more than $100 million in nuclear awards for the third consecutive quarter[5] - Gross margin and adjusted gross margin were 32.3% and 33.5%, respectively, reflecting increases of 110 and 180 basis points compared to the prior year[5] - Operating income and adjusted operating income were $132 million and $147 million, representing increases of 17% and 24% year-over-year[5] - The backlog stood at $2.9 billion, an 11.1% increase from $2.6 billion in the previous year[6] - The Flowserve Pumps Division reported bookings of $852.9 million, up from $703.5 million in the previous year[19] - The Flow Control Division saw bookings increase to $376.0 million from $341.1 million year-over-year[19] - Flowserve's Pumps Division reported a gross profit of $268,462, representing 34.3% of sales for Q1 2025, an increase from 32.2% in Q1 2024[20] - The Flow Control Division achieved a gross profit of $100,187, which is 27.5% of sales, compared to 28.9% in the same quarter last year[21] - Total bookings for the Pumps Division were $852.9 million, up 21.2% year-over-year, while the Flow Control Division saw bookings of $376.0 million, a 10.2% increase[26] - The adjusted operating income for the Pumps Division was $138.6 million, reflecting a 20.6% increase compared to the previous year[26] - The company reported a net earnings of $79,457 thousand for Q1 2025, compared to $77,915 thousand in Q1 2024[28] - The operating income margin for the Pumps Division improved to 17.4%, up 300 basis points from the previous year[26] Guidance and Projections - The company reaffirmed its full-year 2025 guidance, targeting adjusted EPS in the range of $3.10 to $3.30[7] - Total sales growth is projected to be between 5% to 7% for 2025, with organic sales growth expected at 3% to 5%[8] Cash Flow and Assets - Cash from operations was reported at ($49.9 million), a decline of 180.2% compared to $62.3 million in the prior year[6] - Cash and cash equivalents decreased to $540,804 thousand from $675,441 thousand at the end of 2024[27] - The total assets of Flowserve as of March 31, 2025, were $5,483,298 thousand, slightly down from $5,500,821 thousand at the end of 2024[27] Risks and Challenges - Forward-looking statements are based on current expectations and are subject to numerous risks and uncertainties, including global supply chain disruptions and inflationary pressures[31] - The company faces risks related to the conversion of bookings into revenues and the potential for unexpected cancellations or delays in customer orders[31] - There is a substantial dependence on the success of the energy, chemical, power generation, and general industries for sales[31] - The company is exposed to fluctuations in foreign currency exchange rates, particularly in hyperinflationary countries like Argentina[31] - The company acknowledges potential adverse impacts from public health emergencies, such as pandemics, on its business operations[31] - Increased aging and slower collection of receivables are particularly noted in Latin America and other emerging markets[31] - The company is dependent on third-party suppliers, and their failure to perform could adversely affect business operations[31] Management and Strategy - Management emphasizes the importance of successfully developing and introducing new products and integrating new technologies, including artificial intelligence and machine learning, to maintain competitive position[31] - Management does not assume any obligation to update forward-looking statements based on information available as of the date of the release[32] - The company incurred realignment charges of $2,979 thousand in the Pumps Division during the quarter[20]

Financial Performance - Bookings for Q1 2025 increased by $188.1 million, or 18.1%, compared to Q1 2024, totaling $1,226.4 million[130] - Sales for Q1 2025 rose by $57.0 million, or 5.2%, compared to Q1 2024, reaching $1,144.5 million[131] - Gross profit for Q1 2025 increased by $30.3 million, or 8.9%, totaling $369.3 million, with a gross profit margin of 32.3%[133] - Operating income for Q1 2025 rose by $18.8 million, or 16.6%, with an operating margin of 11.5%[138] - Net earnings from affiliates for Q1 2025 increased by $3.2 million, or 128.0%, primarily due to higher earnings from FPD joint ventures in South Korea[137] - SG&A for Q1 2025 increased by $14.8 million, or 6.5%, compared to Q1 2024, with SG&A as a percentage of sales rising to 21.2%[136] - Interest expense for Q1 2025 increased by $3.9 million due to higher outstanding debt, while interest income rose by $0.5 million[139] - Other net expense for Q1 2025 increased by $16.4 million, primarily due to foreign exchange losses and a pension settlement loss of $1.5 million[140] - The effective tax rate for Q1 2025 decreased to 18.3% from 20.5% in Q1 2024[141] - Other comprehensive income for Q1 2025 increased by $74.8 million, resulting from foreign currency translation adjustments[142] Backlog and Future Expectations - Backlog as of March 31, 2025, was $2,902.9 million, an increase of $113.3 million, or 4.1%, from December 31, 2024[132] - The company expects to deliver annual revenue growth in 2025, supported by a strong backlog and improved execution[122] - Backlog increased by $19.8 million, or 2.3%, to $889.4 million at March 31, 2025, with currency effects contributing approximately $9 million[161] Segment Performance - FPD segment bookings for Q1 2025 increased by $149.4 million, or 21.2%, with significant growth in general industries and power generation[147] - FCD segment bookings for Q1 2025 increased by $34.9 million, or 10.2%, driven by orders in the energy and general industries[156] - Gross profit margin for FPD in Q1 2025 improved to 34.3%, while FCD's gross profit margin decreased to 27.5%[149][158] Cash Flow and Capital Management - Cash used by operating activities was $49.9 million for the three months ended March 31, 2025, compared to cash provided of $62.3 million for the same period in 2024[164] - Cash balance decreased by $134.6 million to $540.8 million at March 31, 2025, due to various cash outflows including $27.6 million in dividends and $21.1 million in share repurchases[163] - Capital expenditures for the three months ended March 31, 2025 were $11.7 million, a decrease of $1.9 million compared to the same period in 2024[169] - Cash flows used by financing activities were $84.2 million for the three months ended March 31, 2025, compared to $54.2 million for the same period in 2024[170] - As of March 31, 2025, the company had $662.2 million of available capacity under its Second Amended and Restated Credit Agreement[171] - The company has $258.8 million of remaining capacity for Board of Directors approved share repurchases as of March 31, 2025[174] Risks and Challenges - The company faces increased aging and slower collection of receivables, particularly in Latin America and other emerging markets[188] - Potential adverse effects from new tariffs and related retaliatory actions could impact business operations[188] - The company is exposed to fluctuations in foreign currency exchange rates, especially in hyperinflationary countries like Argentina[188] - The company may face adverse impacts from impairment in the carrying value of goodwill or other intangible assets[188] - The competitive nature of the markets in which the company operates poses challenges to maintaining its competitive position[188] - The company must successfully develop and introduce new products and integrate new technologies, including artificial intelligence and machine learning[188] - The company is dependent on third-party suppliers, whose failure to perform timely could adversely affect operations[188] - Ineffective internal controls could impact the accuracy and timely reporting of business and financial results[188] Acquisition and Investment - The company incurred $1.3 million in acquisition-related costs for the acquisition of MOGAS in Q1 2025[125] - The 2025 Realignment Programs are anticipated to require a total investment of approximately $23 million, with $8 million estimated to be non-cash[126]

Core Insights - FLS has inaugurated a new manufacturing facility for mill liners in Casablanca, Chile, aligning with its CORE'26 strategy and MissionZero sustainability goals [1][4] - The facility represents a significant investment of over DKK 160 million and spans 11,250 m², enhancing FLS's competitive position in the South American market [2] - The plant is designed to produce up to 6,500 tons of coatings annually and integrates various functions to improve efficiency and productivity [2] Sustainability and Community Impact - The LEED-certified facility reduces carbon emissions by up to 56% during manufacturing and recycles all water used in the process [3] - The new facility is expected to create up to 250 jobs in the Valparaíso region of Chile, positively impacting the local community [3] Strategic Commitment - The CEO of FLS emphasized that the new facility is a commitment to responsible mining and the communities in South America, beyond just manufacturing capabilities [4]

Core Viewpoint - FLSmidth has launched a new mill liner recycling service in Chile, emphasizing its commitment to sustainability and enhancing customer productivity, with plans for global expansion in the future [1][2]. Group 1: Sustainability Commitment - The new recycling service aligns with FLS's MissionZero sustainability program, supporting customers' productivity and sustainability goals [2]. - FLS provides CO2 emissions documentation for ESG reporting and helps optimize space on mine sites by eliminating the need for used liner storage [2]. Group 2: Recycling Technology - FLS has developed a portable, scalable, and modular recycling machine that can handle various liner types, shapes, and sizes, enhancing safety and efficiency [3]. - Recycling composite liners can lead to carbon emissions savings of up to 61% compared to producing new liners from virgin materials [3]. Group 3: Company Overview - FLSmidth is a full flowsheet technology and service supplier for the global mining and cement industries, aiming for zero emissions by 2030 through its MissionZero initiative [5].

Group 1 - Zacks Premium offers various tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1] - The Zacks Style Scores are designed to complement the Zacks Rank, helping investors identify stocks with the potential to outperform the market in the short term [2][9] - Stocks are rated on a scale from A to F based on value, growth, and momentum, with higher scores indicating a better chance of outperformance [3] Group 2 - The Value Score focuses on identifying undervalued stocks using financial ratios such as P/E and Price/Sales [4] - The Growth Score emphasizes a company's financial health and future growth potential, analyzing projected and historical earnings [5] - The Momentum Score helps investors capitalize on price trends by assessing recent price changes and earnings estimate revisions [6] Group 3 - The VGM Score combines the three Style Scores to identify stocks with attractive value, strong growth forecasts, and promising momentum [6] - The Zacks Rank is a proprietary model that uses earnings estimate revisions to guide investors in building successful portfolios [7] - Stocks rated 1 (Strong Buy) have historically produced an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [8] Group 4 - For optimal returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [9] - Stocks with lower ranks, even with good Style Scores, may still face downward price pressure due to negative earnings outlooks [10] Group 5 - Flowserve Corporation, a leading manufacturer of flow control systems, is currently rated 3 (Hold) with a VGM Score of A and a Value Style Score of B, indicating attractive valuation metrics [11] - For fiscal 2025, Flowserve's earnings estimate has been revised upwards, with a consensus estimate of $3.20 per share and an average earnings surprise of 5.7% [12]

Group 1 - The Board of Directors of FLSmidth & Co. A/S has allocated a total of 118,815 performance shares to 107 members of the Executive Management and key staff as part of the Long-Term Incentive Programme [1][2] - The vesting period for the allocated shares is three years, contingent upon the fulfillment of specific Key Performance Indicators (KPIs) [2] - The target cost of the performance share programme is DKK 44.6 million, with a maximum potential cost of DKK 66.8 million assuming full vesting [2] Group 2 - The applicable KPIs for the performance shares include Adjusted EBITA as a percentage of revenue, Service Order Intake, Total Shareholder Return, and a Sustainability KPI covering four dimensions [2] - FLSmidth aims to achieve zero emissions in mining and cement by 2030 as part of its sustainability ambition, MissionZero [4]

Core Points - FLSmidth & Co. A/S held its Annual General Meeting on April 2, 2025, where key decisions regarding the company's operations and governance were made [1][2][3][4][5][6][7]. Group 1: Financial Approvals - The Annual Report for 2024 was approved by the General Meeting [2][6]. - A dividend of DKK 8 per share was adopted for distribution [2][4]. - The Remuneration Report for 2024 received approval through an advisory vote [2][6]. Group 2: Board of Directors - The General Meeting re-elected four existing members and elected three new members to the Board of Directors [3][6]. - Mr. Mads Nipper was elected as Chair and Mr. Christian Bruch as Vice Chair during the subsequent board meeting [7]. Group 3: Auditor and Governance - Ernst & Young was re-elected as the auditor for statutory financial and sustainability reporting [4][6]. - The Board of Directors' proposal to amend the articles of association to extend the authorization for share capital increase until April 2, 2030, was approved, allowing for a total aggregate issue of new shares of DKK 100,000,000 [4][6]. Group 4: Share Repurchase - The proposal to authorize the company to repurchase treasury shares until the next Annual General Meeting was approved [5][6].

Core Viewpoint - Flowserve's shares have declined approximately 13% since the last earnings report, underperforming the S&P 500, raising questions about the potential for a breakout or continued negative trend leading up to the next earnings release [1] Estimates Movement - Estimates for Flowserve have trended downward over the past month, with a consensus estimate shift of -9.39% [2] VGM Scores - Flowserve currently holds a Growth Score of A, but has a low Momentum Score of F. The stock has a value grade of B, placing it in the second quintile for this investment strategy. The overall aggregate VGM Score for the stock is B, which is relevant for investors not focused on a single strategy [3] Outlook - The downward trend in estimates indicates a broader negative shift, with Flowserve holding a Zacks Rank of 3 (Hold). An in-line return from the stock is expected in the coming months [4]

Flowserve Corporation (FLS) recently unveiled the world’s first sealless pump INNOMAG TB-MAG Dual Drive, thereby expanding its pump portfolio. The pump is designed to help businesses safely handle hazardous chemicals without the risk of leaks.Inside FLS’ HeadlinesIt is important for the chemical plants that process toxic liquids like hydrofluoric acid and acrylonitrile to take precautionary measures to avoid adversities. Previously Canned Motor Pumps (CMPs) were used to avoid such catastrophic incidents but ...