FLOWSERVE CORP

Previous wording

We continue to see growth from the end-markets we serve and focus on our strategic plan that takes a balanced approach to integrating both short-term and long-term initiatives and aims to accelerate growth through three key areas: diversification, decarbonization, and digitization, the "3D Strategy." Our strategy is expected to deliver sustainable growth, while the Flowserve Business System is expected to unlock gains in organizational and operational efficiency. The current macroeconomic environment is dynamic and uncertainty exists given the trade policy actions introduced throughout 2025, including higher import tariffs in a number of countries in which we operate, the potential implementation of modified or new tariffs and related retaliatory actions. We plan to leverage our global footprint, expansive manufacturing network, flexible supply chain and ability to incorporate tariff impacts into pricing decisions to minimize the economic impact of this uncertainty to our business. We will continue to monitor and manage macroeconomic trends and uncertainties, including inflationary and recessionary pressures resulting from the ongoing tariffs and geopolitical climate; however, with our strong backlog, improved execution and recent acquisition of MOGAS, we expect to deliver annual revenue growth in 2025.

Current wording

We continue to see growth from the end-markets we serve and focus on our strategic plan that takes a balanced approach to integrating both short-term and long-term initiatives and aims to accelerate growth through three key areas: diversification, decarbonization, and digitization, the "3D Strategy." Our strategy is expected to deliver sustainable growth, while the Flowserve Business System is expected to unlock gains in organizational and operational efficiency. The current macroeconomic environment is dynamic and uncertainty exists given the trade policy actions introduced throughout 2025, including higher import tariffs in a number of countries in which we operate, the potential implementation of modified or new tariffs and related retaliatory actions. We plan to leverage our global footprint, expansive manufacturing network, flexible supply chain and ability to incorporate tariff impacts into pricing decisions to minimize the economic impact of this uncertainty to our business. We will continue to monitor and manage macroeconomic trends and uncertainties, including inflationary and recessionary pressures resulting from the ongoing tariffs and geopolitical climate; however, with our strong backlog, improved execution and acquisition of MOGAS, we expect to deliver annual revenue growth in 2025.

Previous wording

As of June 30, 2025, we have cash and cash equi valents of $629.2 million and $661.0 million of borr owings available under our Second Amended and Restated Credit Agreement. We do not currently anticipate, nor are we aware of, any significant market conditions or commitments that would change any of our conclusions of the liquidity currently available to us. We will continue to actively monitor the credit markets in order to maintain sufficient liquidity and access to capital throughout 2025.

Current wording

As of September 30, 2025, we have cash and cash equi valents of $833.8 million and $715.4 million of borr owings available under our Second Amended and Restated Credit Agreement. We do not currently anticipate, nor are we aware of, any significant market conditions or commitments that would change any of our conclusions of the liquidity currently available to us. We will continue to actively monitor the credit markets in order to maintain sufficient liquidity and access to capital throughout 2025.

Previous wording

As discussed in Note 2, "Acquisition," to our condensed consolidated financial statements included in this Quarterly Report, effective October 15, 2024, we acquired for inclusion in FCD, all of the equity interests of MOGAS Industries, Inc., MOGAS Real Estate LLC and MOGAS Systems & Consulting LLC (such entities collectively, "MOGAS"). We incurred $5.2 million in acquisition and integration related costs for the six months ended June 30, 2025 associated with the acquisition which are included within selling, general and administrative expense ("SG&A") in our condensed consolidated statement of income. The impact of the acquisition of MOGAS is not material for the six months ended June 30, 2025.

Current wording

As discussed in Note 2, "Acquisition," to our condensed consolidated financial statements included in this Quarterly Report, effective October 15, 2024, we acquired for inclusion in FCD, all of the equity interests of MOGAS Industries, Inc., MOGAS Real Estate LLC and MOGAS Systems & Consulting LLC (such entities collectively, "MOGAS"). We incurred $9.5 million in acquisition and integration related costs for the nine months ended September 30, 2025 associated with the acquisition which are included within selling, general and administrative expense ("SG&A") in our condensed consolidated statements of income. The impact of the acquisition of MOGAS is not material for the nine months ended September 30, 2025.

Previous wording

Our realignment activities are implemented in phases. We currently anticipate a total investment of approximately $28 million in the 2025 Realignment Programs that have been evaluated and initiated, of which $9 million is estimated to be non-cash. We are evaluating the annualized cost savings expected to be achieved upon completion of the activities of the 2025 Realignment Programs that have been identified and initiated to date. Actual savings could vary from expected savings. There are certain remaining realignment activities that are currently being evaluated, but have not yet been approved and therefore are not included in the above anticipated total investment or estimated savings.

Current wording

Our realignment activities are implemented in phases. We currently anticipate a total investment of approximately $65 million in the 2025 Realignment Programs that have been evaluated and initiated, of which $11 million is estimated to be non-cash. We are evaluating the annualized cost savings expected to be achieved upon completion of the activities of the 2025 Realignment Programs that have been identified and initiated to date. Actual savings could vary from expected savings. There are certain remaining realignment activities that are currently being evaluated, but have not yet been approved and therefore are not included in the above anticipated total investment or estimated savings.

Previous wording

We revised the end market categories for bookings during the first quarter of 2025 to better reflect the end markets of our customers and better align with Flowserve's strategic focus. All bookings by industry amounts discussed below, including the 2024 comparative period, have been reclassified from five categories (i.e., oil and gas, chemical, power, water management and general industries) to four categories (i.e., energy, chemical, power and general industries) to conform to our current classification of end markets. The revisions implemented are as follows:

Current wording

We revised the end market categories for bookings during the first quarter of 2025 to better reflect the end markets of our customers and better align with Flowserve's strategic focus. All bookings by industry amounts discussed below, including the 2024 comparative period, have been reclassified from five categories (i.e., oil and gas, chemical, power generation, water management and general industries) to four categories (i.e., energy, chemical, power generation and general industries) to conform to our current classification of end markets. The revisions implemented are as follows:

Previous wording

We define a booking as the receipt of a customer order that contractually engages us to perform activities on behalf of our customer with regard to manufacturing, service or support. Bookings recorded and subsequently canceled within the year-to-date period are excluded from year-to-date bookings. Bookings for the three months ended June 30, 2025 decreased by $172.2 million, or 13.8%, as compared with the same period in 2024. The decrease included currency benefits of approximately $12 million. The decreased bookings were driven by decreased customer orders of $146 million in the energy industry, $39 million in the chemical industry and $23 million in the power industry, partially offset by an increase of $29 million in the general industries. The decrease in customer bookings was driven by original equipment bookings.

Current wording

We define a booking as the receipt of a customer order that contractually engages us to perform activities on behalf of our customer with regard to manufacturing, service or support. Bookings recorded and subsequently canceled within the year-to-date period are excluded from year-to-date bookings. Bookings for the three months ended September 30, 2025 increased by $9.4 million, or 0.8%, as compared with the same period in 2024. The increase included currency benefits of approximately $18 million. The increased bookings were driven by increased customer orders of $35 million in the power generation industry, $34 million in the chemical industry and $29 million in general industries, partially offset by a decrease of $84 million in the energy industry. The increase in customer bookings was driven by aftermarket bookings.

Previous wording

Bookings for the six months ended June 30, 2025 increased by $15.6 million, or 0.7%, as compared with the same period in 2024. The increase included negative currency effects of approximately $13 million. The increased bookings were driven by increased customer orders of $117 million in the general industries and $35 million in the power industry, partially offset by a decrease of $105 million in the energy industry and $43 million in the chemical industry. The increase in customer bookings was driven by aftermarket bookings.

Current wording

Bookings for the nine months ended September 30, 2025 increased by $24.0 million, or 0.7%, as compared with the same period in 2024. The increase included currency benefits of approximately $5 million. The increased bookings were driven by increased customer orders of $146 million in the general industries and $69 million in the power generation industry, partially offset by a decrease of $189 million in the energy industry and $9 million in the chemical industry. The increase in customer bookings was driven by aftermarket bookings.

Previous wording

Sales for the three months ended June 30, 2025 increased by $31.2 million, or 2.7%, as compared to the same period in 2024. The increase included currency benefits of approximately $12 million. The increased sales were driven by aftermarket customer sales, with increased customer sales of $33 million into North America, $16 million into Africa and $1 million into Europe, partially offset by decreased customer sales of $11 million into Latin America and $8 million into Asia Pacific. Net sales to international customers, including export sales from the United States, were approximately 62% of total sales for both the three months ended June 30, 2025 and 2024. Aftermarket sales represented approximately 53% of total sales, as compared with approximately 51% of total sales for the same period in 2024.

Current wording

Sales for the three months ended September 30, 2025 increased by $41.3 million, or 3.6%, as compared to the same period in 2024. The increase included currency benefits of approximately $15 million. The increased sales were driven by aftermarket customer sales, with increased customer sales of $48 million into North America, $11 million into Africa and $10 million into Europe, partially offset by decreased customer sales of $19 million into Asia Pacific, $8 million into Latin America, and $6 million into the Middle East. Net sales to international customers, including export sales from the United States, were approximately 63% and 64% of total sales for the three months ended September 30, 2025 and 2024, respectively. Aftermarket sales represented approximately 53% of total sales, as compared with approximately 51% of total sales for the same period in 2024.

Previous wording

Sales for the six months ended June 30, 2025 increased by $88.3 million, or 3.9%, as compared to the same period in 2024. The increase included negative currency effects of approximately $12 million. The increased sales were driven by both aftermarket and original equipment customer sales, with increased customer sales of $60 million into North America, $21 million into the Middle East, $13 million into Asia Pacific and $7 million into Africa, partially offset by decreased customer sales of $8 million into Europe and $4 million into Latin America. Net sales to international customers, including export sales from the United States, were approximately 62% and 63% of total sales for the six months ended June 30, 2025 and 2024, respectively. Aftermarket sales represented approximately 52% of total sales, as compared with approximately 51% of total sales for the same period in 2024.

Current wording

Sales for the nine months ended September 30, 2025 increased by $129.6 million, or 3.8%, as compared to the same period in 2024. The increase included currency benefits of approximately $3 million. The increased sales were driven by both aftermarket and original equipment customer sales, with increased customer sales of $108 million into North America,$18 million into Africa, $15 million into the Middle East and $2 million into Europe, partially offset by decreased customer sales of $12 million into Latin America and $6 million into Asia Pacific. Net sales to international customers, including export sales from the United States, were approximately 63% and 64% of total sales for the nine months ended September 30, 2025 and 2024, respectively. Aftermarket sales represented approximately 53% of total sales, as compared with approximately 51% of total sales for the same period in 2024.

Previous wording

Backlog represents the aggregate value of booked but uncompleted customer orders and is influenced primarily by bookings, sales, cancellations and currency effects. Backlog of $2,853.2 million at June 30, 2025 increased by $63.6 million, or 2.3%, as compared to December 31, 2024. Currency effects provided an increase of approximately $159 million (currency effects on backlog are calculated using the change in period end exchange rates). Approximately 40% of the backlog at June 30, 2025 and 37% of the backlog at December 31, 2024 was related to aftermarket orders. Backlog includes our unsatisfied (or partially unsatisfied) performance obligations of approximately $994 million related to contracts having an original expected duration of over one year as discussed in Note 4, "Revenue Recognition," to our condensed consolidated financial statements included in this Quarterly Report.

Current wording

Backlog represents the aggregate value of booked but uncompleted customer orders and is influenced primarily by bookings, sales, cancellations and currency effects. Backlog of $2,896.1 million at September 30, 2025 increased by $106.5 million, or 3.8%, as compared to December 31, 2024. Currency effects provided an increase of approximately $123 million (currency effects on backlog are calculated using the change in period end exchange rates). Approximately 41% of the backlog at September 30, 2025 and 37% of the backlog at December 31, 2024 was related to aftermarket orders. Backlog includes our unsatisfied (or partially unsatisfied) performance obligations of approximately $994 million related to contracts having an original expected duration of over one year as discussed in Note 3, "Revenue Recognition," to our condensed consolidated financial statements included in this Quarterly Report.

Previous wording

SG&A for the six months ended June 30, 2025 increased by $42.1 million, or 9.0%, as compared with the same period in 2024. Currency effects yielded a decrease of approximately $2 million. SG&A increased due to $15.5 million in transaction costs incurred associated with the Chart Merger, $7.1 million of integration costs and amortization of acquisition related intangibles assets associated with the MOGAS acquisition, increased bad debt expense of $3.0 million and higher broad-based annual incentive compensation, partially offset by a decrease in research and development costs of $4.4 million, decreased charges of $4.3 million related to our realignment activities and a $1.8 million discrete software asset impairment recognized in 2024 that did not recur as compared to the same period in 2024. SG&A as a percentage of sales for the six months ended June 30, 2025 increased 100 basis points driven by cost increases.

Current wording

SG&A for the three months ended September 30, 2025 increased by $46.2 million, or 17.8%, as compared with the same period in 2024. Currency effects yielded an increase of approximately $3 million. SG&A increased due to $25.7 million in transaction costs incurred associated with the terminated Chart Merger, increased asbestos-related costs of $18.1 million driven by a $30.1 million adjustment for Incurred But Not Reported ("IBNR") asbestos liability accruals based on an annual actuarial study, increased acquisition and integration costs and amortization of acquisition related intangibles assets associated with the MOGAS acquisition of $3.8 million and increased charges of $2.4 million related to our realignment activities, partially offset by decreased research and development costs of $9.7 million, decreased bad debt expense of $3.8 million, lower broad-based annual incentive compensation and a $2.3 million one-time U.S. pension plan transition benefit charge incurred in the third quarter of 2024 that did not recur as compared to the same period in 2024. SG&A as a percentage of sales for the three months ended September 30, 2025 increased 310 basis points driven by cost increases, including those associated with the Chart Merger and asbestos-related IBNR charges.

Previous wording

SG&A for the three months ended June 30, 2025 increased by $27.3 million, or 11.4%, as compared with the same period in 2024. Currency effects yielded an increase of approximately $3 million. SG&A increased due to $15.5 million in transaction costs incurred associated with the Chart Merger, $4.5 million of integration costs and amortization of acquisition related intangibles assets associated with the MOGAS acquisition and increased bad debt expense of $0.9 million, partially offset by lower broad-based annual incentive compensation, a $1.8 million discrete software asset impairment recognized in 2024 that did not recur, decreased charges of $1.5 million related to our realignment activities and a decrease in research and development costs of $1.3 million as compared to the same period in 2024. SG&A as a percentage of sales for the three months ended June 30, 2025 increased 180 basis points driven by cost increases, including those associated with the Chart Merger.

Current wording

SG&A for the nine months ended September 30, 2025 increased by $88.1 million, or 12.1%, as compared with the same period in 2024. Currency effects yielded an increase of approximately $1 million. SG&A increased due to $41.2 million in transaction costs incurred associated with the terminated Chart Merger, increased asbestos-related costs of $14.8 million for IBNR asbestos liability activity and increased acquisition and integration costs and amortization of acquisition related intangibles assets associated with the MOGAS acquisition of $9.8 million, partially offset by a decrease in research and development costs of $14.1 million, lower broad-based annual incentive compensation, decreased charges of $1.9 million related to our realignment activities, a $1.8 million discrete software asset impairment recognized in 2024 that did not recur and decreased bad debt expense of $0.8 million as compared to the same period in 2024. SG&A as a percentage of sales for the nine months ended September 30, 2025 increased 170 basis points driven by cost increases.

Previous wording

The loss on sale of business for the three and six months ended June 30, 2025 decreased by $13.0 million due to the divestiture of NAF AB in 2024, a previously wholly owned subsidiary and control valves business within our FCD segment, including the NAF AB facility located in Linkoping, Sweden. See Note 1, "Basis of Presentation and Accounting Policies," to our condensed consolidated financial statements included in this Quarterly Report for additional information on this transaction.

Current wording

The loss on sale of business for the nine months ended September 30, 2025 decreased by $13.0 million due to the divestiture of NAF AB in 2024, a previously wholly owned subsidiary and control valves business within our FCD segment, including the NAF AB facility located in Linkoping, Sweden. See Note 1, "Basis of Presentation and Accounting Policies," to our condensed consolidated financial statements included in this Quarterly Report for additional information on this transaction.

Previous wording

Net earnings from affiliates for the three months ended June 30, 2025 decreased by $0.9 million, or 13.2%, as compared with the same period in 2024. The decrease in net earnings was primarily a result of decreased earnings of our FPD joint venture in South Korea.

Current wording

Net earnings from affiliates for the three months ended September 30, 2025 decreased by $1.1 million, or 21.2%, as compared with the same period in 2024. The decrease in net earnings was primarily a result of decreased earnings of our FPD joint venture in South Korea.

Previous wording

Net earnings from affiliates for the six months ended June 30, 2025 increased by $2.3 million, or 24.7%, as compared with the same period in 2024. The increase in net earnings was primarily a result of increased earnings of our FPD joint venture in South Korea.

Current wording

Net earnings from affiliates for the nine months ended September 30, 2025 increased by $1.3 million, or 9.0%, as compared with the same period in 2024. The increase in net earnings was primarily a result of increased earnings of our FPD joint venture in India.

Previous wording

Interest expense for the six months ended June 30, 2025 increased by $7.2 million, as compared with the same period in 2024, primarily due to higher outstanding debt during the period. Interest income for the six months ended June 30, 2025 increased by $2.0 million primarily due to higher average balance as compared to the same period in 2024.

Current wording

Interest expense for the three months ended September 30, 2025 increased by $2.1 million, as compared with the same period in 2024, primarily due to higher outstanding debt during the period. Interest income for the three months ended September 30, 2025 decreased by $0.6 million as compared to the same period in 2024.

Previous wording

Interest expense for the three months ended June 30, 2025 increased by $3.4 million, as compared with the same period in 2024, primarily due to higher outstanding debt during the period. Interest income for the three months ended June 30, 2025 increased by $1.3 million primarily due to higher average balance as compared to the same period in 2024.

Current wording

Interest expense for the nine months ended September 30, 2025 increased by $9.4 million, as compared with the same period in 2024, primarily due to higher outstanding debt during the period. Interest income for the nine months ended September 30, 2025 increased by $1.4 million primarily due to a higher average balance as compared to the same period in 2024.

Previous wording

Other expense, net for the three months ended June 30, 2025 increased $19.7 million as compared to the same period in 2024, primarily due to a $23.1 million increase in losses from transactions in currencies other than our sites' functional currencies, partially offset by a $3.3 million increase in gains arising from transactions on foreign exchange forward contracts. The net change was primarily due to the foreign currency exchange rate movements in the Euro, Swedish krona, Singapore dollar and Indian rupee real during the three months ended June 30, 2025, as compared to the same period in 2024. The three-month period ended June 30, 2025 also includes a pension settlement loss of $1.5 million incurred in conjunction with the freeze of our U.S. Qualified pension plan, which represents a portion of the estimated full year expected settlement loss of $6 million - $7 million triggered due to expected cash outflows exceeding service and interest costs.

Current wording

Other income (expense), net for the three months ended September 30, 2025 increased $262.1 million as compared to the same period in 2024, primarily due to the $266.0 million payment we received per the Mutual Termination Agreement for the terminated Chart Merger and a $1.1 million decrease in losses from transactions in currencies other than our sites' functional currencies, partially offset by a $3.3 million increase in losses arising from transactions on foreign exchange forward contracts. The net currency change was primarily due to the foreign currency exchange rate movements in the Mexican peso, Singapore dollar, United Arab Emirates dirham, Indian rupee and Euro during the three months ended September 30, 2025, as compared to the same period in 2024. The three-month period ended September 30, 2025 also includes a pension settlement loss of $1.5 million incurred in conjunction with the freeze of our U.S. Qualified pension plan, which represents a portion of the estimated full year expected settlement loss of $5 million - $6 million triggered due to expected cash outflows exceeding service and interest costs.

Previous wording

Other expense, net for the six months ended June 30, 2025 increased $36.2 million as compared to the same period in 2024, primarily due to a $26.0 million increase in losses from transactions in currencies other than our sites' functional currencies and a $6.6 million increase in losses arising from transactions on foreign exchange forward contracts. The net change was primarily due to the foreign currency exchange rate movements in the Euro, Swedish krona, and Singapore dollar during the six months ended June 30, 2025, as compared to the same period in 2024. The six months ended June 30, 2025 also includes a pension settlement loss of $3.0 million incurred in conjunction with the freeze of our U.S. Qualified pension plan, which represents a portion of the estimated full year expected settlement loss of $6 million - $7 million triggered due to expected cash outflows exceeding service and interest costs.

Current wording

Other income (expense), net for the nine months ended September 30, 2025 increased $226.1 million as compared to the same period in 2024, primarily due to the $266.0 million payment we received per the Mutual Termination Agreement for the terminated Chart Merger, partially offset by a $24.9 million increase in losses from transactions in currencies other than our sites' functional currencies and a $9.8 million increase in losses arising from transactions on foreign exchange forward contracts. The net currency change was primarily due to the foreign currency exchange rate movements in the Mexican peso, Euro, Swedish krona, Brazilian real, Singapore dollar and Indian rupee during the nine months ended September 30, 2025, as compared to the same period in 2024. The nine months ended September 30, 2025 also includes a pension settlement loss of $4.5 million incurred in conjunction with the freeze of our U.S. Qualified pension plan, which represents a portion of the estimated full year expected settlement loss of $5 million - $6 million triggered due to expected cash outflows exceeding service and interest costs.

Previous wording

The effective tax rate of 15.1% for the three months ended June 30, 2025 decreased from 23.8% for the same period in 2024. The effective tax rate varied from the U.S. federal statutory rate for the three months ended June 30, 2025 primarily due to the net impact of foreign operations. Refer to Note 16, "Income Taxes," to our condensed consolidated financial statements included in this Quarterly Report for further discussion.

Current wording

The effective tax rate of 29.5% for the three months ended September 30, 2025 increased from 22.8% for the same period in 2024. The effective tax rate varied from the U.S. federal statutory rate for the three months ended September 30, 2025 primarily due to the impacts pursuant to the enactment of OBBBA and state income taxes, partially offset by the net impact of foreign operations. Refer to Note 15, "Income Taxes," to our condensed consolidated financial statements included in this Quarterly Report for further discussion.

Previous wording

The effective tax rate of 16.6% for the six months ended June 30, 2025 decreased from 22.2% for the same period in 2024. The effective tax rate varied from the U.S. federal statutory rate for the six months ended June 30, 2025 primarily due to the net impact of foreign operations and U.S. discrete items, partially offset by state income tax. Refer to Note 16, "Income Taxes," to our condensed consolidated financial statements included in this Quarterly Report for further discussion.

Current wording

The effective tax rate of 24.5% for the nine months ended September 30, 2025 increased from 22.4% for the same period in 2024. The effective tax rate varied from the U.S. federal statutory rate for the nine months ended September 30, 2025 primarily due to the impacts pursuant to the enactment of OBBBA and state income taxes, partially offset by the net impact of foreign operations. Refer to Note 15, "Income Taxes," to our condensed consolidated financial statements included in this Quarterly Report for further discussion.

Previous wording

Other comprehensive income for the six months ended June 30, 2025 increased by $208.8 million from a loss of $50.5 million in the same period in 2024. The increase was due to foreign currency translation adjustments resulting primarily from exchange rate movements of the Euro, British pound and Mexican peso versus the U.S. dollar during the six months ended June 30, 2025, as compared to the same period in 2024.

Current wording

Other comprehensive income for the three months ended September 30, 2025 decreased by $64.6 million to a loss from income of $50.7 million in the same period in 2024. The decrease was due to foreign currency translation adjustments resulting primarily from exchange rate movements of the Indian rupee, Euro, British pound and Mexican peso versus the U.S. dollar during the three months ended September 30, 2025, as compared to the same period in 2024.

Previous wording

Other comprehensive income for the three months ended June 30, 2025 increased by $134.0 million from a loss of $23.6 million in the same period in 2024. The increase was due to foreign currency translation adjustments resulting primarily from exchange rate movements of the Euro, British pound, and Mexican peso versus the U.S. dollar during the three months ended June 30, 2025, as compared to the same period in 2024.

Current wording

Other comprehensive income for the nine months ended September 30, 2025 increased by $144.2 million from income of $0.2 million in the same period in 2024. The increase was due to foreign currency translation adjustments resulting primarily from exchange rate movements of the Euro, British pound and Mexican peso versus the U.S. dollar during the nine months ended September 30, 2025, as compared to the same period in 2024.

Previous wording

As discussed above, we revised the end market categories for bookings during the first quarter of 2025. All bookings by industry amounts discussed below, including the 2024 comparative period, have been reclassified from five categories (i.e., oil and gas, chemical, power, water management, and general industries) to four categories (i.e., energy, chemical, power and general industries) to conform to our current classification of end markets.

Current wording

As discussed above, we revised the end market categories for bookings during the first quarter of 2025. All bookings by industry amounts discussed below, including the 2024 comparative period, have been reclassified from five categories (i.e., oil and gas, chemical, power generation, water management, and general industries) to four categories (i.e., energy, chemical, power generation and general industries) to conform to our current classification of end markets.

Previous wording

Bookings for the six months ended June 30, 2025 decreased by $26.1 million, or 1.6%, as compared to the same period in 2024. The decrease included negative currency effects of approximately $10 million. The decrease in customer bookings was primarily driven by decreased customer orders of $142 million in the energy industry and $32 million in the chemical industry, partially offset by increased customer orders of $107 million in the general industries and $39 million in the power industry. Customer bookings decreased $128 million into the Middle East, $17 million into Latin America and $13 million into Asia Pacific, and were partially offset by increased customer orders of $88 million into North America, $27 million into Africa and $14 million into Europe. The decrease in customer bookings was driven by original equipment bookings.

Current wording

Bookings for the nine months ended September 30, 2025 decreased by $93.8 million, or 3.8%, as compared to the same period in 2024. The decrease included currency benefits of approximately $5 million. The decrease in customer bookings was primarily driven by decreased customer orders of $220 million in the energy industry and $21 million in the chemical industry, partially offset by increased customer orders of $114 million in the general industries and $37 million in the power generation industry. Customer bookings decreased $140 million into the Middle East, $33 million into Asia Pacific and $14 million into Latin America, and were partially offset by increased customer orders of $56 million into North America, $32 million into Africa and $9 million into Europe. The decrease in customer bookings was driven by original equipment bookings.

Previous wording

Sales for the three months ended June 30, 2025 increased by $6.7 million, or 0.8% as compared to the same period in 2024 and included currency benefits of approximately $9 million. The increase was driven by aftermarket customer sales. Increased customer sales of approximately $20 million into North America and $17 million into Africa were partially offset by decreased customer sales of approximately $17 million into Latin America, $7 million into Asia Pacific and $6 million into Europe.

Current wording

Sales for the three months ended September 30, 2025 increased by $18.2 million, or 2.3% as compared to the same period in 2024 and included currency benefits of approximately $12 million. The increase was driven by aftermarket customer sales. Increased customer sales of approximately $26 million into North America, $11 million into Africa and $7 million into Europe were partially offset by decreased customer sales of approximately $15 million into Asia Pacific, $12 million into Latin America and $1 million into the Middle East.

Previous wording

Sales for the six months ended June 30, 2025 increased by $20.5 million, or 1.3% as compared to the same period in 2024 and included negative currency effects of approximately $10 million. The increase was driven by aftermarket customer sales. Increased customer sales of approximately $36 million into North America, $14 million into Africa and $10 million into the Middle East were partially offset by decreased customer sales of approximately $16 million into Asia Pacific, $15 million into Latin America and $10 million into Europe.

Current wording

Sales for the nine months ended September 30, 2025 increased by $38.7 million, or 1.6% as compared to the same period in 2024 and included currency benefits of approximately $2 million. The increase was driven by aftermarket customer sales. Increased customer sales of approximately $62 million into North America, $25 million into Africa and $9 million into the Middle East were partially offset by decreased customer sales of approximately $31 million into Asia Pacific, $27 million into Latin America and $4 million into Europe.

Previous wording

Gross profit for the three months ended June 30, 2025 increased by $39.0 million, or 15.0%, as compared to the same period in 2024. Gross profit margin for the three months ended June 30, 2025 of 36.5% increased from 32.0% for the same period in 2024. The increase in gross profit margin was primarily due to strategic sourcing decisions, an improved selective bidding approach, favorable mix and decreased charges of $5.5 million related to our realignment activities, partially offset by higher broad-based annual incentive compensation as compared to the same period in 2024.

Current wording

Gross profit for the three months ended September 30, 2025 increased by $12.6 million, or 5.0%, as compared to the same period in 2024. Gross profit margin for the three months ended September 30, 2025 of 33.2% increased from 32.4% for the same period in 2024. The increase in gross profit margin was primarily due to strategic sourcing decisions, an improved selective bidding approach, favorable mix, lower broad-based annual incentive compensation and a $1.7 million one-time U.S. pension plan transition benefit charge incurred in the third quarter of 2024 that did not recur, partially offset by increased charges of $13.2 million related to our realignment activities as compared to the same period in 2024.

Previous wording

Gross profit for the six months ended June 30, 2025 increased by $59.5 million, or 11.7%, as compared to the same period in 2024. Gross profit margin for the six months ended June 30, 2025 of 35.4% increased from 32.1% for the same period in 2024. The increase in gross profit margin was primarily due to strategic sourcing decisions, an improved selective bidding approach, favorable mix and decreased charges of $7.6 million related to our realignment activities, partially offset by higher broad-based annual incentive compensation as compared to the same period in 2024.

Current wording

Gross profit for the nine months ended September 30, 2025 increased by $72.2 million, or 9.5%, as compared to the same period in 2024. Gross profit margin for the nine months ended September 30, 2025 of 34.7% increased from 32.2% for the same period in 2024. The increase in gross profit margin was primarily due to strategic sourcing decisions, an improved selective bidding approach, favorable mix, lower broad-based annual incentive compensation and a $1.7 million one-time U.S. pension plan transition benefit charge incurred in the third quarter of 2024 that did not recur, partially offset by increased charges of $5.7 million related to our realignment activities as compared to the same period in 2024.

Previous wording

FCD designs, manufactures and distributes a broad portfolio ofengineered-to-order and configured-to-order isolation valves, control valves, valve automation products and related equipment. FCD leverages its experience and application know-how by offering a complete menu of engineered services to complement its expansive product portfolio. FCD has a total of 44 manufacturing facilities and QRCs in 22 countries around the world, with six of its 19 manufacturing operations located in the United States, seven located in Europe and the Middle East, five located in Asia Pacific and one located in Latin America. Based on independent industry sources, we believe that FCD is the second largest industrial valve supplier on a global basis.

Current wording

FCD designs, manufactures and distributes a broad portfolio of engineered-to-order and configured-to-order isolation valves, control valves, valve automation products and related equipment. FCD leverages its experience and application know-how by offering a complete menu of engineered services to complement its expansive product portfolio. FCD has a total of 44 manufacturing facilities and QRCs in 22 countries around the world, with six of its 19 manufacturing operations located in the United States, seven located in Europe and the Middle East, five located in Asia Pacific and one located in Latin America. Based on independent industry sources, we believe that FCD is the second largest industrial valve supplier on a global basis.

Previous wording

As discussed above, we revised the end market categories for bookings during the first quarter of 2025. All bookings by industry amounts discussed below, including the 2024 comparative period, have been reclassified from five categories (i.e., oil and gas, chemical, power, water management, and general industries) to four categories (i.e., energy, chemical, power and general industries) to conform to our current classification of end markets.

Current wording

As discussed above, we revised the end market categories for bookings during the first quarter of 2025. All bookings by industry amounts discussed below, including the 2024 comparative period, have been reclassified from five categories (i.e., oil and gas, chemical, power generation, water management, and general industries) to four categories (i.e., energy, chemical, power generation and general industries) to conform to our current classification of end markets.

Previous wording

Bookings for the three months ended June 30, 2025 increased by $5.5 million, or 1.6%, as compared with the same period in 2024. Bookings included currency benefits of approximately $2 million. The increase in customer bookings was driven by increased customer orders of $13 million in the energy industry and $2 million in the general industries, partially offset by decreased customer orders of $8 million in the chemical industry and $7 million in the power industry. Increased customer bookings were driven by increased orders of $20 million into the Middle East, $4 million into North America and $2 million into Africa, partially offset by decreased orders of $19 million into Europe, $6 million into Asia Pacific and $2 million into Latin America. The increase was primarily driven by customer aftermarket bookings.

Current wording

Bookings for the three months ended September 30, 2025 increased by $77.7 million, or 24.4%, as compared with the same period in 2024. Bookings included currency benefits of approximately $2 million. The increase in customer bookings was driven by increased customer orders of $37 million in the power generation industry, $23 million in the chemical industry and $22 million in the general industries, partially offset by decreased customer orders of $6 million in the energy industry. Increased customer bookings were driven by increased orders of $36 million into Europe, $27 million into North America, $11 million into the Middle East, $7 million into Africa and $2 million into Latin America, partially offset by decreased orders of $7 million into Asia Pacific. The increase was driven by both original equipment and aftermarket bookings.

Previous wording

Bookings for the six months ended June 30, 2025 increased by $40.5 million, or 5.9%, as compared with the same period in 2024. Bookings included negative currency effects of approximately $3 million. The increase in customer bookings was primarily driven by increased customer orders of $37 million in the energy industry and $10 million in the general industries, partially offset by decreased customer orders of $11 million in the chemical industry and $4 million in the power industry. Increased customer bookings were driven by increased orders of $46 million into the Middle East, $46 million into North America and $1 million into Africa, partially offset by decreased orders of $39 million into Europe and $22 million into Asia Pacific. The increase was driven by both customer original equipment and aftermarket bookings.

Current wording

Bookings for the nine months ended September 30, 2025 increased by $117.8 million, or 11.7%, as compared with the same period in 2024. Bookings included negative currency effects of approximately $1 million. The increase in customer bookings was primarily driven by increased customer orders of $33 million in the power generation industry, $32 million in the general industries, $31 million in the energy industry and $12 million in the chemical industry. Increased customer bookings were driven by increased orders of $73 million into North America, $57 million into the Middle East, $8 million into Africa and $2 million into Latin America, partially offset by decreased orders of $29 million into Asia Pacific and $3 million into Europe. The increase was driven by both original equipment and aftermarket bookings.

Previous wording

Sales for the three months ended June 30, 2025 increased $23.8 million, or 6.8%, as compared with the same period in 2024. The increase included currency benefits of approximately $3 million. Increased sales were driven by both original equipment and aftermarket customer sales. The increase was primarily driven by increased customer sales of $13 million into North America, $7 million into Europe and $6 million into Latin America, partially offset by decreased customer sales of $1 million into Asia Pacific.

Current wording

Sales for the three months ended September 30, 2025 increased $24.3 million, or 6.9%, as compared with the same period in 2024. The increase included currency benefits of approximately $3 million. Increased sales were driven by aftermarket customer sales. The increase was primarily driven by increased customer sales of $22 million into North America, $4 million into Europe, $3 million into Latin America and $1 million into Africa, partially offset by decreased customer sales of $5 million into the Middle East and $4 million into Asia Pacific.

Previous wording

Sales for the six months ended June 30, 2025 increased $67.4 million, or 10.1%, as compared with the same period in 2024. The increase included negative currency effects of approximately $2 million. Increased sales were driven by both original equipment and aftermarket customer sales. The increase was primarily driven by increased customer sales of $29 million into Asia Pacific, $24 million into North America, $12 million into Latin America, $11 million into the Middle East and $2 million into Europe, partially offset by decreased customer sales of $7 million into Africa.

Current wording

Sales for the nine months ended September 30, 2025 increased $91.5 million, or 9.0%, as compared with the same period in 2024. The increase included currency benefits of approximately $1 million. Increased sales were driven by both original equipment and aftermarket customer sales. The increase was primarily driven by increased customer sales of $46 million into North America, $25 million into Asia Pacific, $15 million into Latin America, $6 million into the Middle East and $6 million into Europe, partially offset by decreased customer sales of $6 million into Africa.

Previous wording

Gross profit for the six months ended June 30, 2025 increased by $8.9 million, or 4.5%, as compared with the same period in 2024. Gross profit margin for the six months ended June 30, 2025 of 28.3% decreased from 29.8% for the same period in 2024. The decrease in gross profit margin was primarily due to increased charges of $9.3 million related to our realignment activities and $6.9 million of integration costs and amortization of step-up in value of acquired inventories and acquisition related intangibles assets associated with the MOGAS acquisition, partially offset by the favorable impact of previously implemented sales price increases and lower broad-based annual incentive compensation as compared to the same period in 2024.

Current wording

Gross profit for the nine months ended September 30, 2025 increased by $16.6 million, or 5.4%, as compared with the same period in 2024. Gross profit margin for the nine months ended September 30, 2025 of 28.9% decreased from 29.9% for the same period in 2024. The decrease in gross profit margin was primarily due to increased charges of $15.3 million related to our realignment activities and an increase of $9.5 million of integration costs and amortization of step-up in value of acquired inventories and acquisition related intangibles assets associated with the MOGAS acquisition, partially offset by the favorable impact of previously implemented sales price increases and lower broad-based annual incentive compensation as compared to the same period in 2024.

Previous wording

Loss on sale of business for the three and six months ended June 30, 2025 decreased by $13.0 million due to the divestiture of NAF AB in 2024, a previously wholly owned subsidiary and control valves business within our FCD segment, including the NAF AB facility located in Linkoping, Sweden. The loss on sale of business is included within charges related to our realignment activities.

Current wording

Loss on sale of business for the three and nine months ended September 30, 2025 decreased by $13.0 million due to the divestiture of NAF AB in 2024, a previously wholly owned subsidiary and control valves business within our FCD segment, including the NAF AB facility located in Linkoping, Sweden. The loss on sale of business is included within charges related to our realignment activities.

Previous wording

Operating income for the three months ended June 30, 2025 increased by $5.5 million, or 17.0%, as compared with the same period in 2024. The increase included negative currency effects of less than $1 million. The increase was primarily due to the $13.0 million loss on sale of business in 2024 that did not recur and the $1.4 million increase in gross profit, partially offset by the $8.9 million increase in SG&A.

Current wording

Operating income for the three months ended September 30, 2025 decreased by $0.3 million, or 0.6%, as compared with the same period in 2024. The decrease included negative currency effects of less than $1 million. The decrease was primarily due to the $8.0 million increase in SG&A, partially offset by the $7.7 million increase in gross profit.

Previous wording

Operating income for the six months ended June 30, 2025 increased by $2.3 million, or 3.4%, as compared with the same period in 2024. The increase included negative currency effects of approximately $1 million. The increase was primarily due to the $13.0 million loss on sale of business in 2024 that did not recur and the $8.9 million increase in gross profit, partially offset by the $19.6 million increase in SG&A.

Current wording

Operating income for the nine months ended September 30, 2025 increased by $2.0 million, or 1.8%, as compared with the same period in 2024. The increase included negative currency effects of approximately $1 million. The increase was primarily due to the $16.6 million increase in gross profit and the $13.0 million loss on sale of business in 2024 that did not recur, partially offset by the $27.6 million increase in SG&A.

Previous wording

Our cash balance decreased by $46.2 million to $629.2 million at June 30, 2025, as compared with December 31, 2024. The cash activity during the first six months of 2025 included cash provided by operating activities, $55.2 million in dividend payments, $52.8 million of share repurchases, $15.0 million contingent consideration payment related to the MOGAS acquisition, $28.3 million in capital expenditures and $18.8 million of payments on our $500.0 million unsecured term loan facility (the "Term Loan").

Current wording

Our cash balance increased by $158.4 million to $833.8 million at September 30, 2025, as compared with December 31, 2024. The cash activity during the first nine months of 2025 included cash provided by operating activities, $45.5 million in capital expenditures, $197.9 million of share repurchases, $82.7 million in dividend payments, $28.1 million of payments on our $500.0 million unsecured term loan facility (the "Term Loan") and $15.0 million contingent consideration payment related to the MOGAS acquisition.