Flowserve(FLS) - 2025 Q1 - Quarterly Results

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$132 million and $147 million, representing increases of 17$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$852.9 million, up 21.2% year-over-year, while the Flow Control Division saw bookings of $376.0 million, a 10.2$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$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]