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|
|
|
þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
MARCH 31, 2014
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
to
.
|
New York
|
|
31-0267900
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
5215 N. O’Connor Blvd., Suite 2300, Irving, Texas
|
|
75039
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
(972) 443-6500
|
|
(Registrant’s telephone number, including area code)
|
Large accelerated filer
þ
|
Accelerated filer
¨
|
Non-accelerated filer
¨
(do not check if a smaller reporting company)
|
Smaller reporting company
¨
|
|
|
|
|
|
|
Page
|
|
No.
|
|
|
|
|
|
|
|
|
EX-31.1
|
|
EX-31.2
|
|
EX-32.1
|
|
EX-32.2
|
|
EX-101 INSTANCE DOCUMENT
|
|
EX-101 SCHEMA DOCUMENT
|
|
EX-101 CALCULATION LINKBASE DOCUMENT
|
|
EX-101 LABELS LINKBASE DOCUMENT
|
|
EX-101 PRESENTATION LINKBASE DOCUMENT
|
|
EX-101 DEFINITION LINKBASE DOCUMENT
|
|
Item 1.
|
Financial Statements.
|
(Amounts in thousands, except per share data)
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
Sales
|
$
|
1,068,136
|
|
|
$
|
1,096,596
|
|
Cost of sales
|
(691,014
|
)
|
|
(723,288
|
)
|
||
Gross profit
|
377,122
|
|
|
373,308
|
|
||
Selling, general and administrative expense
|
(216,227
|
)
|
|
(234,509
|
)
|
||
Net earnings from affiliates (Note 2)
|
3,431
|
|
|
31,680
|
|
||
Operating income
|
164,326
|
|
|
170,479
|
|
||
Interest expense
|
(15,149
|
)
|
|
(12,092
|
)
|
||
Interest income
|
331
|
|
|
274
|
|
||
Other expense, net
|
(2,905
|
)
|
|
(11,028
|
)
|
||
Earnings before income taxes
|
146,603
|
|
|
147,633
|
|
||
Provision for income taxes
|
(38,015
|
)
|
|
(48,733
|
)
|
||
Net earnings, including noncontrolling interests
|
108,588
|
|
|
98,900
|
|
||
Less: Net earnings attributable to noncontrolling interests
|
(854
|
)
|
|
(1,111
|
)
|
||
Net earnings attributable to Flowserve Corporation
|
$
|
107,734
|
|
|
$
|
97,789
|
|
Net earnings per share attributable to Flowserve Corporation common shareholders:
|
|
|
|
||||
Basic
|
$
|
0.78
|
|
|
$
|
0.68
|
|
Diluted
|
0.78
|
|
|
0.67
|
|
||
Cash dividends declared per share
|
$
|
0.16
|
|
|
$
|
0.14
|
|
(Amounts in thousands)
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
Net earnings, including noncontrolling interests
|
$
|
108,588
|
|
|
$
|
98,900
|
|
Other comprehensive income (loss):
|
|
|
|
||||
Foreign currency translation adjustments, net of taxes of
$(1,786)
and $22,790, respectively
|
2,951
|
|
|
(37,661
|
)
|
||
Pension and other postretirement effects, net of taxes of $(938) and $(2,771), respectively
|
2,779
|
|
|
6,732
|
|
||
Cash flow hedging activity, net of taxes of
$(71)
and $(173), respectively
|
168
|
|
|
241
|
|
||
Other comprehensive income (loss)
|
5,898
|
|
|
(30,688
|
)
|
||
Comprehensive income, including noncontrolling interests
|
114,486
|
|
|
68,212
|
|
||
Comprehensive income attributable to noncontrolling interests
|
(1,030
|
)
|
|
(1,344
|
)
|
||
Comprehensive income attributable to Flowserve Corporation
|
$
|
113,456
|
|
|
$
|
66,868
|
|
(Amounts in thousands, except par value)
|
March 31,
|
|
December 31,
|
||||
|
2014
|
|
2013
|
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
164,416
|
|
|
$
|
363,804
|
|
Accounts receivable, net of allowance for doubtful accounts of $23,554 and $24,073, respectively
|
1,064,216
|
|
|
1,155,327
|
|
||
Inventories, net
|
1,121,248
|
|
|
1,060,670
|
|
||
Deferred taxes
|
156,486
|
|
|
157,448
|
|
||
Prepaid expenses and other
|
100,901
|
|
|
110,133
|
|
||
Total current assets
|
2,607,267
|
|
|
2,847,382
|
|
||
Property, plant and equipment, net of accumulated depreciation of $852,042 and $849,863, respectively
|
694,921
|
|
|
716,289
|
|
||
Goodwill
|
1,101,434
|
|
|
1,107,551
|
|
||
Deferred taxes
|
19,444
|
|
|
19,533
|
|
||
Other intangible assets, net
|
155,495
|
|
|
160,548
|
|
||
Other assets, net
|
180,847
|
|
|
185,430
|
|
||
Total assets
|
$
|
4,759,408
|
|
|
$
|
5,036,733
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
470,222
|
|
|
$
|
612,092
|
|
Accrued liabilities
|
756,420
|
|
|
861,010
|
|
||
Debt due within one year
|
75,088
|
|
|
72,678
|
|
||
Deferred taxes
|
12,280
|
|
|
12,319
|
|
||
Total current liabilities
|
1,314,010
|
|
|
1,558,099
|
|
||
Long-term debt due after one year
|
1,117,244
|
|
|
1,127,619
|
|
||
Retirement obligations and other liabilities
|
465,281
|
|
|
473,894
|
|
||
Shareholders’ equity:
|
|
|
|
||||
Common shares, $1.25 par value
|
220,991
|
|
|
220,991
|
|
||
Shares authorized – 305,000
|
|
|
|
||||
Shares issued – 176,793 and 176,793, respectively
|
|
|
|
||||
Capital in excess of par value
|
464,281
|
|
|
476,218
|
|
||
Retained earnings
|
3,070,775
|
|
|
2,985,391
|
|
||
Treasury shares, at cost – 40,476 and 39,630 shares, respectively
|
(1,693,994
|
)
|
|
(1,600,266
|
)
|
||
Deferred compensation obligation
|
9,188
|
|
|
9,522
|
|
||
Accumulated other comprehensive loss
|
(215,755
|
)
|
|
(221,477
|
)
|
||
Total Flowserve Corporation shareholders’ equity
|
1,855,486
|
|
|
1,870,379
|
|
||
Noncontrolling interests
|
7,387
|
|
|
6,742
|
|
||
Total equity
|
1,862,873
|
|
|
1,877,121
|
|
||
Total liabilities and equity
|
$
|
4,759,408
|
|
|
$
|
5,036,733
|
|
(Amounts in thousands)
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
Cash flows – Operating activities:
|
|
|
|
||||
Net earnings, including noncontrolling interests
|
$
|
108,588
|
|
|
$
|
98,900
|
|
Adjustments to reconcile net earnings to net cash used by operating activities:
|
|
|
|
||||
Depreciation
|
23,058
|
|
|
21,403
|
|
||
Amortization of intangible and other assets
|
4,305
|
|
|
3,807
|
|
||
Net loss on disposition of assets
|
74
|
|
|
236
|
|
||
Gain on sale of business
|
(13,403
|
)
|
|
—
|
|
||
Gain on sale of equity investment in affiliate
|
—
|
|
|
(12,995
|
)
|
||
Gain on remeasurement of acquired assets
|
—
|
|
|
(15,315
|
)
|
||
Excess tax benefits from stock-based compensation arrangements
|
(8,353
|
)
|
|
(6,818
|
)
|
||
Stock-based compensation
|
9,916
|
|
|
8,035
|
|
||
Net earnings from affiliates, net of dividends received
|
(1,986
|
)
|
|
(3,066
|
)
|
||
Change in assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
77,264
|
|
|
40,223
|
|
||
Inventories, net
|
(76,990
|
)
|
|
(83,502
|
)
|
||
Prepaid expenses and other
|
(6,897
|
)
|
|
(9,831
|
)
|
||
Other assets, net
|
4,025
|
|
|
70
|
|
||
Accounts payable
|
(123,050
|
)
|
|
(103,881
|
)
|
||
Accrued liabilities and income taxes payable
|
(77,552
|
)
|
|
(55,413
|
)
|
||
Retirement obligations and other liabilities
|
(4,437
|
)
|
|
10,102
|
|
||
Net deferred taxes
|
773
|
|
|
(25
|
)
|
||
Net cash flows used by operating activities
|
(84,665
|
)
|
|
(108,070
|
)
|
||
Cash flows – Investing activities:
|
|
|
|
||||
Capital expenditures
|
(31,663
|
)
|
|
(34,258
|
)
|
||
Proceeds from disposal of assets
|
301
|
|
|
212
|
|
||
Payments for acquisition, net of cash acquired
|
—
|
|
|
(10,143
|
)
|
||
Proceeds from sale of business, net of cash divested
|
46,805
|
|
|
—
|
|
||
Proceeds from equity investments in affiliates
|
—
|
|
|
46,240
|
|
||
Net cash flows provided by investing activities
|
15,443
|
|
|
2,051
|
|
||
Cash flows – Financing activities:
|
|
|
|
||||
Excess tax benefits from stock-based compensation arrangements
|
8,353
|
|
|
6,818
|
|
||
Payments on long-term debt
|
(10,000
|
)
|
|
(5,000
|
)
|
||
Proceeds from revolving credit facility
|
—
|
|
|
150,000
|
|
||
Borrowings (payments) under other financing arrangements, net
|
1,809
|
|
|
(4,013
|
)
|
||
Repurchases of common shares
|
(109,605
|
)
|
|
(155,552
|
)
|
||
Payments of dividends
|
(19,387
|
)
|
|
(17,514
|
)
|
||
Other
|
(385
|
)
|
|
(121
|
)
|
||
Net cash flows used by financing activities
|
(129,215
|
)
|
|
(25,382
|
)
|
||
Effect of exchange rate changes on cash
|
(951
|
)
|
|
(3,414
|
)
|
||
Net change in cash and cash equivalents
|
(199,388
|
)
|
|
(134,815
|
)
|
||
Cash and cash equivalents at beginning of period
|
363,804
|
|
|
304,252
|
|
||
Cash and cash equivalents at end of period
|
$
|
164,416
|
|
|
$
|
169,437
|
|
1.
|
Basis of Presentation and Accounting Policies
|
2.
|
Disposition, Acquisition and Exit of Joint Venture
|
3.
|
Stock-Based Compensation Plans
|
|
Three Months Ended March 31, 2014
|
|||||
|
Shares
|
|
Weighted Average
Grant-Date Fair
Value
|
|||
Number of unvested shares:
|
|
|
|
|||
Outstanding - January 1, 2014
|
2,020,678
|
|
|
$
|
44.68
|
|
Granted
|
464,804
|
|
|
72.21
|
|
|
Vested
|
(749,024
|
)
|
|
43.97
|
|
|
Canceled
|
(50,028
|
)
|
|
49.19
|
|
|
Outstanding - March 31, 2014
|
1,686,430
|
|
|
$
|
52.44
|
|
4.
|
Derivative Instruments and Hedges
|
|
March 31,
|
|
December 31,
|
||||
(Amounts in thousands)
|
2014
|
|
2013
|
||||
Current derivative assets
|
$
|
6,181
|
|
|
$
|
5,215
|
|
Noncurrent derivative assets
|
215
|
|
|
729
|
|
||
Current derivative liabilities
|
658
|
|
|
2,207
|
|
||
Noncurrent derivative liabilities
|
—
|
|
|
113
|
|
|
March 31,
|
|
December 31,
|
||||
(Amounts in thousands)
|
2014
|
|
2013
|
||||
Current derivative assets
|
$
|
96
|
|
|
$
|
146
|
|
Current derivative liabilities
|
276
|
|
|
409
|
|
||
Noncurrent derivative liabilities
|
10
|
|
|
37
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in thousands)
|
2014
|
|
2013
|
||||
Gain (loss) recognized in income
|
$
|
1,544
|
|
|
$
|
(2,997
|
)
|
5.
|
Debt
|
|
March 31,
|
|
December 31,
|
||||
(Amounts in thousands, except percentages)
|
2014
|
|
2013
|
||||
4.00% Senior Notes due November 15, 2023, net of unamortized discount
|
$
|
298,644
|
|
|
$
|
298,615
|
|
3.50% Senior Notes due September 15, 2022 net of unamortized discount
|
498,331
|
|
|
498,289
|
|
||
Term Loan Facility, interest rate of 1.48% at March 31, 2014 and 1.50% at December 31, 2013
|
360,000
|
|
|
370,000
|
|
||
Capital lease obligations and other borrowings
|
35,357
|
|
|
33,393
|
|
||
Debt and capital lease obligations
|
1,192,332
|
|
|
1,200,297
|
|
||
Less amounts due within one year
|
75,088
|
|
|
72,678
|
|
||
Total debt due after one year
|
$
|
1,117,244
|
|
|
$
|
1,127,619
|
|
6.
|
Supplemental Guarantor Financial Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2014
|
||||||||||||||||||
|
Parent (Issuer)
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Total
|
||||||||||
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
$
|
—
|
|
|
$
|
442,507
|
|
|
$
|
702,072
|
|
|
$
|
(76,443
|
)
|
|
$
|
1,068,136
|
|
Cost of sales
|
—
|
|
|
(282,213
|
)
|
|
(485,244
|
)
|
|
76,443
|
|
|
(691,014
|
)
|
|||||
Gross profit
|
—
|
|
|
160,294
|
|
|
216,828
|
|
|
—
|
|
|
377,122
|
|
|||||
Selling, general and administrative expense
|
(449
|
)
|
|
(51,172
|
)
|
|
(164,606
|
)
|
|
—
|
|
|
(216,227
|
)
|
|||||
Net earnings from affiliates
|
—
|
|
|
388
|
|
|
3,043
|
|
|
—
|
|
|
3,431
|
|
|||||
Net earnings from consolidated subsidiaries, net of tax
|
114,460
|
|
|
39,181
|
|
|
—
|
|
|
(153,641
|
)
|
|
—
|
|
|||||
Operating income
|
114,011
|
|
|
148,691
|
|
|
55,265
|
|
|
(153,641
|
)
|
|
164,326
|
|
|||||
Interest expense, net
|
(9,134
|
)
|
|
(2,679
|
)
|
|
(3,005
|
)
|
|
—
|
|
|
(14,818
|
)
|
|||||
Other expense, net
|
—
|
|
|
(1,863
|
)
|
|
(1,042
|
)
|
|
—
|
|
|
(2,905
|
)
|
|||||
Earnings before income taxes
|
104,877
|
|
|
144,149
|
|
|
51,218
|
|
|
(153,641
|
)
|
|
146,603
|
|
|||||
Provision for income taxes
|
2,857
|
|
|
(29,689
|
)
|
|
(11,183
|
)
|
|
—
|
|
|
(38,015
|
)
|
|||||
Net earnings, including noncontrolling interests
|
107,734
|
|
|
114,460
|
|
|
40,035
|
|
|
(153,641
|
)
|
|
108,588
|
|
|||||
Less: Net earnings attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(854
|
)
|
|
—
|
|
|
(854
|
)
|
|||||
Net earnings attributable to Flowserve Corporation
|
$
|
107,734
|
|
|
$
|
114,460
|
|
|
$
|
39,181
|
|
|
$
|
(153,641
|
)
|
|
$
|
107,734
|
|
Comprehensive income attributable to Flowserve Corporation
|
$
|
113,456
|
|
|
$
|
120,054
|
|
|
$
|
46,329
|
|
|
$
|
(166,383
|
)
|
|
$
|
113,456
|
|
|
Three Months Ended March 31, 2013
|
||||||||||||||||||
|
Parent (Issuer)
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Total
|
||||||||||
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
$
|
—
|
|
|
$
|
447,577
|
|
|
$
|
731,386
|
|
|
$
|
(82,367
|
)
|
|
$
|
1,096,596
|
|
Cost of sales
|
—
|
|
|
(288,964
|
)
|
|
(516,691
|
)
|
|
82,367
|
|
|
(723,288
|
)
|
|||||
Gross profit
|
—
|
|
|
158,613
|
|
|
214,695
|
|
|
—
|
|
|
373,308
|
|
|||||
Selling, general and administrative expense
|
(338
|
)
|
|
(92,788
|
)
|
|
(141,383
|
)
|
|
—
|
|
|
(234,509
|
)
|
|||||
Net earnings from affiliates
|
—
|
|
|
225
|
|
|
31,455
|
|
|
—
|
|
|
31,680
|
|
|||||
Net earnings from consolidated subsidiaries, net of tax
|
102,555
|
|
|
60,274
|
|
|
—
|
|
|
(162,829
|
)
|
|
—
|
|
|||||
Operating income
|
102,217
|
|
|
126,324
|
|
|
104,767
|
|
|
(162,829
|
)
|
|
170,479
|
|
|||||
Interest expense, net
|
(6,500
|
)
|
|
(2,780
|
)
|
|
(2,538
|
)
|
|
—
|
|
|
(11,818
|
)
|
|||||
Other expense, net
|
—
|
|
|
(1,673
|
)
|
|
(9,355
|
)
|
|
—
|
|
|
(11,028
|
)
|
|||||
Earnings before income taxes
|
95,717
|
|
|
121,871
|
|
|
92,874
|
|
|
(162,829
|
)
|
|
147,633
|
|
|||||
Provision for income taxes
|
2,072
|
|
|
(19,316
|
)
|
|
(31,489
|
)
|
|
—
|
|
|
(48,733
|
)
|
|||||
Net earnings, including noncontrolling interests
|
97,789
|
|
|
102,555
|
|
|
61,385
|
|
|
(162,829
|
)
|
|
98,900
|
|
|||||
Less: Net earnings attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(1,111
|
)
|
|
—
|
|
|
(1,111
|
)
|
|||||
Net earnings attributable to Flowserve Corporation
|
$
|
97,789
|
|
|
$
|
102,555
|
|
|
$
|
60,274
|
|
|
$
|
(162,829
|
)
|
|
$
|
97,789
|
|
Comprehensive income attributable to Flowserve Corporation
|
$
|
66,868
|
|
|
$
|
71,077
|
|
|
$
|
26,916
|
|
|
$
|
(97,993
|
)
|
|
$
|
66,868
|
|
|
March 31, 2014
|
||||||||||||||||||
|
Parent (Issuer)
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Total
|
||||||||||
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
2,407
|
|
|
$
|
—
|
|
|
$
|
162,009
|
|
|
$
|
—
|
|
|
$
|
164,416
|
|
Accounts receivable, net
|
—
|
|
|
261,909
|
|
|
802,307
|
|
|
—
|
|
|
1,064,216
|
|
|||||
Intercompany receivables
|
2,090
|
|
|
148,543
|
|
|
361,577
|
|
|
(512,210
|
)
|
|
—
|
|
|||||
Inventories, net
|
—
|
|
|
392,799
|
|
|
728,449
|
|
|
—
|
|
|
1,121,248
|
|
|||||
Other current assets, net
|
664
|
|
|
131,257
|
|
|
125,466
|
|
|
—
|
|
|
257,387
|
|
|||||
Total current assets
|
5,161
|
|
|
934,508
|
|
|
2,179,808
|
|
|
(512,210
|
)
|
|
2,607,267
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
220,484
|
|
|
474,437
|
|
|
—
|
|
|
694,921
|
|
|||||
Goodwill
|
—
|
|
|
709,240
|
|
|
392,194
|
|
|
—
|
|
|
1,101,434
|
|
|||||
Intercompany receivables
|
432,500
|
|
|
11,384
|
|
|
20,321
|
|
|
(464,205
|
)
|
|
—
|
|
|||||
Investment in consolidated subsidiaries
|
2,579,769
|
|
|
1,899,135
|
|
|
—
|
|
|
(4,478,904
|
)
|
|
—
|
|
|||||
Other assets, net
|
14,505
|
|
|
197,569
|
|
|
143,712
|
|
|
—
|
|
|
355,786
|
|
|||||
Total assets
|
$
|
3,031,935
|
|
|
$
|
3,972,320
|
|
|
$
|
3,210,472
|
|
|
$
|
(5,455,319
|
)
|
|
$
|
4,759,408
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
—
|
|
|
$
|
129,738
|
|
|
$
|
340,484
|
|
|
$
|
—
|
|
|
$
|
470,222
|
|
Intercompany payables
|
260
|
|
|
363,407
|
|
|
148,543
|
|
|
(512,210
|
)
|
|
—
|
|
|||||
Accrued liabilities
|
11,249
|
|
|
239,083
|
|
|
506,088
|
|
|
—
|
|
|
756,420
|
|
|||||
Debt due within one year
|
40,000
|
|
|
—
|
|
|
35,088
|
|
|
—
|
|
|
75,088
|
|
|||||
Deferred taxes
|
—
|
|
|
—
|
|
|
12,280
|
|
|
—
|
|
|
12,280
|
|
|||||
Total current liabilities
|
51,509
|
|
|
732,228
|
|
|
1,042,483
|
|
|
(512,210
|
)
|
|
1,314,010
|
|
|||||
Long-term debt due after one year
|
1,116,974
|
|
|
—
|
|
|
270
|
|
|
—
|
|
|
1,117,244
|
|
|||||
Intercompany payables
|
1,144
|
|
|
451,677
|
|
|
11,384
|
|
|
(464,205
|
)
|
|
—
|
|
|||||
Retirement obligations and other liabilities
|
6,822
|
|
|
208,646
|
|
|
249,813
|
|
|
—
|
|
|
465,281
|
|
|||||
Total liabilities
|
1,176,449
|
|
|
1,392,551
|
|
|
1,303,950
|
|
|
(976,415
|
)
|
|
2,896,535
|
|
|||||
Total Flowserve Corporation shareholders’ equity
|
1,855,486
|
|
|
2,579,769
|
|
|
1,899,135
|
|
|
(4,478,904
|
)
|
|
1,855,486
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
7,387
|
|
|
—
|
|
|
7,387
|
|
|||||
Total equity
|
1,855,486
|
|
|
2,579,769
|
|
|
1,906,522
|
|
|
(4,478,904
|
)
|
|
1,862,873
|
|
|||||
Total liabilities and equity
|
$
|
3,031,935
|
|
|
$
|
3,972,320
|
|
|
$
|
3,210,472
|
|
|
$
|
(5,455,319
|
)
|
|
$
|
4,759,408
|
|
|
December 31, 2013
|
||||||||||||||||||
|
Parent (Issuer)
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Total
|
||||||||||
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
29,086
|
|
|
$
|
—
|
|
|
$
|
334,718
|
|
|
$
|
—
|
|
|
$
|
363,804
|
|
Accounts receivable, net
|
—
|
|
|
263,594
|
|
|
891,733
|
|
|
—
|
|
|
1,155,327
|
|
|||||
Intercompany receivables
|
—
|
|
|
155,422
|
|
|
74,089
|
|
|
(229,511
|
)
|
|
—
|
|
|||||
Inventories, net
|
—
|
|
|
371,172
|
|
|
689,498
|
|
|
—
|
|
|
1,060,670
|
|
|||||
Other current assets, net
|
1,879
|
|
|
144,551
|
|
|
121,151
|
|
|
—
|
|
|
267,581
|
|
|||||
Total current assets
|
30,965
|
|
|
934,739
|
|
|
2,111,189
|
|
|
(229,511
|
)
|
|
2,847,382
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
220,072
|
|
|
496,217
|
|
|
—
|
|
|
716,289
|
|
|||||
Goodwill
|
—
|
|
|
715,722
|
|
|
391,829
|
|
|
—
|
|
|
1,107,551
|
|
|||||
Intercompany receivables
|
432,500
|
|
|
9,520
|
|
|
186,789
|
|
|
(628,809
|
)
|
|
—
|
|
|||||
Investment in consolidated subsidiaries
|
2,579,701
|
|
|
1,850,998
|
|
|
—
|
|
|
(4,430,699
|
)
|
|
—
|
|
|||||
Other assets, net
|
15,486
|
|
|
211,755
|
|
|
138,270
|
|
|
—
|
|
|
365,511
|
|
|||||
Total assets
|
$
|
3,058,652
|
|
|
$
|
3,942,806
|
|
|
$
|
3,324,294
|
|
|
$
|
(5,289,019
|
)
|
|
$
|
5,036,733
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
—
|
|
|
$
|
163,254
|
|
|
$
|
448,838
|
|
|
$
|
—
|
|
|
$
|
612,092
|
|
Intercompany payables
|
81
|
|
|
74,008
|
|
|
155,422
|
|
|
(229,511
|
)
|
|
—
|
|
|||||
Accrued liabilities
|
12,874
|
|
|
293,012
|
|
|
555,124
|
|
|
—
|
|
|
861,010
|
|
|||||
Debt due within one year
|
40,000
|
|
|
5
|
|
|
32,673
|
|
|
—
|
|
|
72,678
|
|
|||||
Deferred taxes
|
—
|
|
|
—
|
|
|
12,319
|
|
|
—
|
|
|
12,319
|
|
|||||
Total current liabilities
|
52,955
|
|
|
530,279
|
|
|
1,204,376
|
|
|
(229,511
|
)
|
|
1,558,099
|
|
|||||
Long-term debt due after one year
|
1,126,904
|
|
|
—
|
|
|
715
|
|
|
—
|
|
|
1,127,619
|
|
|||||
Intercompany payables
|
1,144
|
|
|
618,145
|
|
|
9,520
|
|
|
(628,809
|
)
|
|
—
|
|
|||||
Retirement obligations and other liabilities
|
7,270
|
|
|
214,681
|
|
|
251,943
|
|
|
—
|
|
|
473,894
|
|
|||||
Total liabilities
|
1,188,273
|
|
|
1,363,105
|
|
|
1,466,554
|
|
|
(858,320
|
)
|
|
3,159,612
|
|
|||||
Total Flowserve Corporation shareholders’ equity
|
1,870,379
|
|
|
2,579,701
|
|
|
1,850,998
|
|
|
(4,430,699
|
)
|
|
1,870,379
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
6,742
|
|
|
—
|
|
|
6,742
|
|
|||||
Total equity
|
1,870,379
|
|
|
2,579,701
|
|
|
1,857,740
|
|
|
(4,430,699
|
)
|
|
1,877,121
|
|
|||||
Total liabilities and equity
|
$
|
3,058,652
|
|
|
$
|
3,942,806
|
|
|
$
|
3,324,294
|
|
|
$
|
(5,289,019
|
)
|
|
$
|
5,036,733
|
|
|
Three Months Ended March 31, 2014
|
||||||||||||||||||
|
Parent (Issuer)
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Total
|
||||||||||
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash flows provided (used) by operating activities
|
$
|
112,313
|
|
|
$
|
(11,060
|
)
|
|
$
|
(59,182
|
)
|
|
$
|
(126,736
|
)
|
|
$
|
(84,665
|
)
|
Cash flows — Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Capital expenditures
|
—
|
|
|
(12,655
|
)
|
|
(19,008
|
)
|
|
—
|
|
|
(31,663
|
)
|
|||||
Proceeds from sale of business, net of cash divested
|
—
|
|
|
—
|
|
|
46,805
|
|
|
—
|
|
|
46,805
|
|
|||||
Intercompany loan proceeds
|
—
|
|
|
—
|
|
|
166,468
|
|
|
(166,468
|
)
|
|
—
|
|
|||||
Intercompany loan payments
|
—
|
|
|
(1,865
|
)
|
|
(306,634
|
)
|
|
308,499
|
|
|
—
|
|
|||||
Proceeds from disposition of assets
|
—
|
|
|
26
|
|
|
275
|
|
|
—
|
|
|
301
|
|
|||||
Net cash flows (used) provided by investing activities
|
—
|
|
|
(14,494
|
)
|
|
(112,094
|
)
|
|
142,031
|
|
|
15,443
|
|
|||||
Cash flows — Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Excess tax benefits from stock-based payment arrangements
|
—
|
|
|
6,425
|
|
|
1,928
|
|
|
—
|
|
|
8,353
|
|
|||||
Payments on long-term debt
|
(10,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
|||||
(Payments) borrowings under other financing arrangements, net
|
—
|
|
|
(5
|
)
|
|
1,814
|
|
|
—
|
|
|
1,809
|
|
|||||
Repurchases of common shares
|
(109,605
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(109,605
|
)
|
|||||
Payments of dividends
|
(19,387
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,387
|
)
|
|||||
Intercompany loan proceeds
|
—
|
|
|
306,634
|
|
|
1,865
|
|
|
(308,499
|
)
|
|
—
|
|
|||||
Intercompany loan payments
|
—
|
|
|
(166,468
|
)
|
|
—
|
|
|
166,468
|
|
|
—
|
|
|||||
Intercompany dividends
|
—
|
|
|
(121,032
|
)
|
|
(5,704
|
)
|
|
126,736
|
|
|
—
|
|
|||||
All other financing, net
|
—
|
|
|
—
|
|
|
(385
|
)
|
|
—
|
|
|
(385
|
)
|
|||||
Net cash flows (used) provided by financing activities
|
(138,992
|
)
|
|
25,554
|
|
|
(482
|
)
|
|
(15,295
|
)
|
|
(129,215
|
)
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
|
—
|
|
|
(951
|
)
|
|
—
|
|
|
(951
|
)
|
|||||
Net change in cash and cash equivalents
|
(26,679
|
)
|
|
—
|
|
|
(172,709
|
)
|
|
—
|
|
|
(199,388
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
29,086
|
|
|
—
|
|
|
334,718
|
|
|
—
|
|
|
363,804
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
2,407
|
|
|
$
|
—
|
|
|
$
|
162,009
|
|
|
$
|
—
|
|
|
$
|
164,416
|
|
|
Three Months Ended March 31, 2013
|
||||||||||||||||||
|
Parent (Issuer)
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Total
|
||||||||||
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash flows provided (used) by operating activities
|
$
|
26,554
|
|
|
$
|
(42,173
|
)
|
|
$
|
(58,918
|
)
|
|
$
|
(33,533
|
)
|
|
$
|
(108,070
|
)
|
Cash flows — Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Capital expenditures
|
—
|
|
|
(8,783
|
)
|
|
(25,475
|
)
|
|
—
|
|
|
(34,258
|
)
|
|||||
Payments for acquisition, net of cash acquired
|
—
|
|
|
—
|
|
|
(10,143
|
)
|
|
—
|
|
|
(10,143
|
)
|
|||||
Intercompany loan proceeds
|
—
|
|
|
901
|
|
|
—
|
|
|
(901
|
)
|
|
—
|
|
|||||
Intercompany loan payments
|
—
|
|
|
—
|
|
|
(76,759
|
)
|
|
76,759
|
|
|
—
|
|
|||||
Proceeds from disposition of assets
|
—
|
|
|
25
|
|
|
187
|
|
|
—
|
|
|
212
|
|
|||||
Proceeds from equity investment in affiliates
|
—
|
|
|
—
|
|
|
46,240
|
|
|
—
|
|
|
46,240
|
|
|||||
Net cash flows (used) provided by investing activities
|
—
|
|
|
(7,857
|
)
|
|
(65,950
|
)
|
|
75,858
|
|
|
2,051
|
|
|||||
Cash flows — Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Excess tax benefits from stock-based payment arrangements
|
—
|
|
|
5,038
|
|
|
1,780
|
|
|
—
|
|
|
6,818
|
|
|||||
Payments on long-term debt
|
(5,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,000
|
)
|
|||||
Proceeds from short-term financing
|
150,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
150,000
|
|
|||||
Payments under other financing arrangements
|
—
|
|
|
(5
|
)
|
|
(4,008
|
)
|
|
—
|
|
|
(4,013
|
)
|
|||||
Repurchases of common shares
|
(155,552
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(155,552
|
)
|
|||||
Payments of dividends
|
(17,514
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,514
|
)
|
|||||
Intercompany loan proceeds
|
—
|
|
|
76,759
|
|
|
—
|
|
|
(76,759
|
)
|
|
—
|
|
|||||
Intercompany loan payments
|
—
|
|
|
—
|
|
|
(901
|
)
|
|
901
|
|
|
—
|
|
|||||
Intercompany dividends
|
—
|
|
|
(31,762
|
)
|
|
(1,771
|
)
|
|
33,533
|
|
|
—
|
|
|||||
All other financing, net
|
47
|
|
|
—
|
|
|
(168
|
)
|
|
—
|
|
|
(121
|
)
|
|||||
Net cash flows (used) provided by financing activities
|
(28,019
|
)
|
|
50,030
|
|
|
(5,068
|
)
|
|
(42,325
|
)
|
|
(25,382
|
)
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
|
—
|
|
|
(3,414
|
)
|
|
—
|
|
|
(3,414
|
)
|
|||||
Net change in cash and cash equivalents
|
(1,465
|
)
|
|
—
|
|
|
(133,350
|
)
|
|
—
|
|
|
(134,815
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
2,609
|
|
|
—
|
|
|
301,643
|
|
|
—
|
|
|
304,252
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
1,144
|
|
|
$
|
—
|
|
|
$
|
168,293
|
|
|
$
|
—
|
|
|
$
|
169,437
|
|
7.
|
Fair Value
|
8.
|
Inventories
|
|
March 31,
|
|
December 31,
|
||||
(Amounts in thousands)
|
2014
|
|
2013
|
||||
Raw materials
|
$
|
371,481
|
|
|
$
|
356,899
|
|
Work in process
|
863,478
|
|
|
786,664
|
|
||
Finished goods
|
304,111
|
|
|
306,765
|
|
||
Less: Progress billings
|
(332,701
|
)
|
|
(304,395
|
)
|
||
Less: Excess and obsolete reserve
|
(85,121
|
)
|
|
(85,263
|
)
|
||
Inventories, net
|
$
|
1,121,248
|
|
|
$
|
1,060,670
|
|
9.
|
Earnings Per Share
|
|
Three Months Ended March 31,
|
||||||
(Amounts in thousands, except per share data)
|
2014
|
|
2013
|
||||
Net earnings of Flowserve Corporation
|
$
|
107,734
|
|
|
$
|
97,789
|
|
Dividends on restricted shares not expected to vest
|
3
|
|
|
3
|
|
||
Earnings attributable to common and participating shareholders
|
$
|
107,737
|
|
|
$
|
97,792
|
|
Weighted average shares:
|
|
|
|
||||
Common stock
|
137,123
|
|
|
143,710
|
|
||
Participating securities
|
611
|
|
|
759
|
|
||
Denominator for basic earnings per common share
|
137,734
|
|
|
144,469
|
|
||
Effect of potentially dilutive securities
|
1,136
|
|
|
1,162
|
|
||
Denominator for diluted earnings per common share
|
138,870
|
|
|
145,631
|
|
||
Earnings per common share:
|
|
|
|
||||
Basic
|
$
|
0.78
|
|
|
$
|
0.68
|
|
Diluted
|
0.78
|
|
|
0.67
|
|
|
|
|
|
10.
|
Legal Matters and Contingencies
|
11.
|
Retirement and Postretirement Benefits
|
|
U.S.
Defined Benefit Plans
|
|
Non-U.S.
Defined Benefit Plans
|
|
Postretirement
Medical Benefits
|
||||||||||||||||||
(Amounts in millions)
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||
Service cost
|
$
|
5.7
|
|
|
$
|
6.1
|
|
|
$
|
1.7
|
|
|
$
|
1.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
4.4
|
|
|
3.8
|
|
|
3.7
|
|
|
3.4
|
|
|
0.3
|
|
|
0.3
|
|
||||||
Expected return on plan assets
|
(5.5
|
)
|
|
(5.1
|
)
|
|
(2.7
|
)
|
|
(2.4
|
)
|
|
—
|
|
|
—
|
|
||||||
Amortization of prior service benefit
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of unrecognized net loss (gain)
|
2.0
|
|
|
3.5
|
|
|
1.7
|
|
|
1.7
|
|
|
(0.4
|
)
|
|
(0.3
|
)
|
||||||
Net periodic cost (benefit) recognized
|
$
|
6.7
|
|
|
$
|
8.3
|
|
|
$
|
4.5
|
|
|
$
|
4.4
|
|
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12.
|
Shareholders’ Equity
|
13.
|
Income Taxes
|
14.
|
Segment Information
|
Three Months Ended March 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(Amounts in thousands)
|
Engineered Product Division
|
|
Industrial Product Division
|
|
Flow Control Division
|
|
Subtotal–Reportable Segments
|
|
Eliminations and All Other
|
|
Consolidated Total
|
||||||||||||
Sales to external customers
|
$
|
489,297
|
|
|
$
|
197,007
|
|
|
$
|
381,832
|
|
|
$
|
1,068,136
|
|
|
$
|
—
|
|
|
$
|
1,068,136
|
|
Intersegment sales
|
15,928
|
|
|
14,816
|
|
|
1,107
|
|
|
31,851
|
|
|
(31,851
|
)
|
|
—
|
|
||||||
Segment operating income
|
79,325
|
|
|
23,318
|
|
|
83,134
|
|
|
185,777
|
|
|
(21,451
|
)
|
|
164,326
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Three Months Ended March 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(Amounts in thousands)
|
Engineered Product Division
|
|
Industrial Product Division
|
|
Flow Control Division
|
|
Subtotal–Reportable Segments
|
|
Eliminations and All Other
|
|
Consolidated Total
|
||||||||||||
Sales to external customers
|
$
|
523,775
|
|
|
$
|
190,946
|
|
|
$
|
381,875
|
|
|
$
|
1,096,596
|
|
|
$
|
—
|
|
|
$
|
1,096,596
|
|
Intersegment sales
|
15,916
|
|
|
20,354
|
|
|
2,154
|
|
|
38,424
|
|
|
(38,424
|
)
|
|
—
|
|
||||||
Segment operating income
|
84,603
|
|
|
21,354
|
|
|
87,169
|
|
|
193,126
|
|
|
(22,647
|
)
|
|
170,479
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||||||||||
(Amounts in thousands)
|
Foreign currency translation items(1)
|
|
Pension and other post-retirement effects
|
|
Cash flow hedging activity
|
|
Total(1)
|
|
Foreign currency translation items(1)
|
|
Pension and other post-retirement effects
|
|
Cash flow hedging activity
|
|
Total(1)
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Balance - January 1
|
$
|
(89,953
|
)
|
|
$
|
(129,528
|
)
|
|
$
|
(814
|
)
|
|
$
|
(220,295
|
)
|
|
$
|
(61,083
|
)
|
|
$
|
(161,757
|
)
|
|
$
|
(254
|
)
|
|
$
|
(223,094
|
)
|
Other comprehensive income (loss) before reclassifications
|
(2,509
|
)
|
|
298
|
|
|
24
|
|
|
(2,187
|
)
|
|
(38,878
|
)
|
|
3,480
|
|
|
(29
|
)
|
|
(35,427
|
)
|
||||||||
Amounts reclassified from AOCL
|
5,460
|
|
|
2,481
|
|
|
144
|
|
|
8,085
|
|
|
1,217
|
|
|
3,252
|
|
|
270
|
|
|
4,739
|
|
||||||||
Net current-period other comprehensive income (loss)
|
2,951
|
|
|
2,779
|
|
|
168
|
|
|
5,898
|
|
|
(37,661
|
)
|
|
6,732
|
|
|
241
|
|
|
(30,688
|
)
|
||||||||
Balance - March 31
|
$
|
(87,002
|
)
|
|
$
|
(126,749
|
)
|
|
$
|
(646
|
)
|
|
$
|
(214,397
|
)
|
|
$
|
(98,744
|
)
|
|
$
|
(155,025
|
)
|
|
$
|
(13
|
)
|
|
$
|
(253,782
|
)
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in thousands)
|
|
Affected line item in the statement of income
|
|
2014(1)
|
|
2013(1)
|
||||
Foreign currency translation items
|
|
|
|
|
|
|
||||
Release of cumulative translation adjustments upon sale of equity method investment
|
|
Net earnings from affiliates
|
|
$
|
—
|
|
|
$
|
(1,217
|
)
|
Release of cumulative translation adjustments due to sale of business
|
|
Selling, general and administrative expense
|
|
(5,460
|
)
|
|
—
|
|
||
|
|
Tax benefit
|
|
—
|
|
|
—
|
|
||
|
|
Net of tax
|
|
$
|
(5,460
|
)
|
|
$
|
(1,217
|
)
|
|
|
|
|
|
|
|
||||
Cash flow hedging activity
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
Interest expense
|
|
$
|
(230
|
)
|
|
$
|
(432
|
)
|
|
|
Tax benefit
|
|
86
|
|
|
162
|
|
||
|
|
Net of tax
|
|
$
|
(144
|
)
|
|
$
|
(270
|
)
|
|
|
|
|
|
|
|
||||
Pension and other postretirement effects
|
|
|
|
|
|
|
||||
Amortization of actuarial losses(2)
|
|
|
|
$
|
(3,427
|
)
|
|
$
|
(4,801
|
)
|
Prior service costs
|
|
|
|
(118
|
)
|
|
—
|
|
||
|
|
Tax benefit
|
|
1,064
|
|
|
1,549
|
|
||
|
|
Net of tax
|
|
$
|
(2,481
|
)
|
|
$
|
(3,252
|
)
|
|
|
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Engineered Product Division ("EPD") for long lead-time, custom and other highly-engineered pumps and pump systems, mechanical seals, auxiliary systems and replacement parts and related services;
|
•
|
IPD for engineered and pre-configured industrial pumps and pump systems and related products and services; and
|
•
|
FCD for engineered and industrial valves, control valves, actuators and controls and related services.
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions)
|
2014
|
|
2013
|
||||
Bookings
|
$
|
1,193.9
|
|
|
$
|
1,190.0
|
|
Sales
|
1,068.1
|
|
|
1,096.6
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
Gross profit
|
$
|
377.1
|
|
|
$
|
373.3
|
|
Gross profit margin
|
35.3
|
%
|
|
34.0
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
SG&A
|
$
|
216.2
|
|
|
$
|
234.5
|
|
SG&A as a percentage of sales
|
20.2
|
%
|
|
21.4
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions)
|
2014
|
|
2013
|
||||
Net earnings from affiliates
|
$
|
3.4
|
|
|
$
|
31.7
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
Operating income
|
$
|
164.3
|
|
|
$
|
170.5
|
|
Operating income as a percentage of sales
|
15.4
|
%
|
|
15.5
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions)
|
2014
|
|
2013
|
||||
Interest expense
|
$
|
(15.1
|
)
|
|
$
|
(12.1
|
)
|
Interest income
|
0.3
|
|
|
0.3
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions)
|
2014
|
|
2013
|
||||
Other expense, net
|
$
|
(2.9
|
)
|
|
$
|
(11.0
|
)
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
Provision for income taxes
|
$
|
38.0
|
|
|
$
|
48.7
|
|
Effective tax rate
|
25.9
|
%
|
|
33.0
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions)
|
2014
|
|
2013
|
||||
Other comprehensive income (loss)
|
$
|
5.9
|
|
|
$
|
(30.7
|
)
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
Bookings
|
$
|
594.3
|
|
|
$
|
585.1
|
|
Sales
|
505.2
|
|
|
539.7
|
|
||
Gross profit
|
178.5
|
|
|
188.2
|
|
||
Gross profit margin
|
35.3
|
%
|
|
34.9
|
%
|
||
Segment operating income
|
79.3
|
|
|
84.6
|
|
||
Segment operating income as a percentage of sales
|
15.7
|
%
|
|
15.7
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
Bookings
|
$
|
229.1
|
|
|
$
|
207.5
|
|
Sales
|
211.8
|
|
|
211.3
|
|
||
Gross profit
|
55.2
|
|
|
53.0
|
|
||
Gross profit margin
|
26.1
|
%
|
|
25.1
|
%
|
||
Segment operating income
|
23.3
|
|
|
21.4
|
|
||
Segment operating income as a percentage of sales
|
11.0
|
%
|
|
10.1
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions, except percentages)
|
2014
|
|
2013
|
||||
Bookings
|
$
|
413.7
|
|
|
$
|
430.6
|
|
Sales
|
382.9
|
|
|
384.0
|
|
||
Gross profit
|
144.4
|
|
|
133.9
|
|
||
Gross profit margin
|
37.7
|
%
|
|
34.9
|
%
|
||
Segment operating income
|
83.1
|
|
|
87.2
|
|
||
Segment operating income as a percentage of sales
|
21.7
|
%
|
|
22.7
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in millions)
|
2014
|
|
2013
|
||||
Net cash flows used by operating activities
|
$
|
(84.7
|
)
|
|
$
|
(108.1
|
)
|
Net cash flows provided by investing activities
|
15.4
|
|
|
2.1
|
|
||
Net cash flows used by financing activities
|
(129.2
|
)
|
|
(25.4
|
)
|
•
|
Revenue Recognition;
|
•
|
Deferred Taxes, Tax Valuation Allowances and Tax Reserves;
|
•
|
Reserves for Contingent Loss;
|
•
|
Retirement and Postretirement Benefits; and
|
•
|
Valuation of Goodwill, Indefinite-Lived Intangible Assets and Other Long-Lived Assets.
|
•
|
a portion of our bookings may not lead to completed sales, and our ability to convert bookings into revenues at acceptable profit margins;
|
•
|
changes in the global financial markets and the availability of capital and the potential for unexpected cancellations or delays of customer orders in our reported backlog;
|
•
|
our dependence on our customers' ability to make required capital investment and maintenance expenditures;
|
•
|
risks associated with cost overruns on fixed fee projects and in accepting customer orders for large complex custom engineered products;
|
•
|
the substantial dependence of our sales on the success of the oil and gas, chemical, power generation and water management industries;
|
•
|
the adverse impact of volatile raw materials prices on our products and operating margins;
|
•
|
economic, political and other risks associated with our international operations, including military actions or trade embargoes that could affect customer markets, particularly North African, Russian and Middle Eastern markets and global oil and gas producers, and non-compliance with U.S. export/reexport control, foreign corrupt practice laws, economic sanctions and import laws and regulations;
|
•
|
increased aging and slower collection of receivables, particularly in Latin America and other emerging markets;
|
•
|
our exposure to fluctuations in foreign currency exchange rates, particularly the Euro and British pound and in hyperinflationary countries such as Venezuela;
|
•
|
our furnishing of products and services to nuclear power plant facilities and other critical applications;
|
•
|
potential adverse consequences resulting from litigation to which we are a party, such as litigation involving asbestos-containing material claims;
|
•
|
a foreign government investigation regarding our participation in the United Nations Oil-For-Food Program;
|
•
|
expectations regarding acquisitions and the integration of acquired businesses;
|
•
|
our relative geographical profitability and its impact on our utilization of deferred tax assets, including foreign tax credits;
|
•
|
the potential adverse impact of an impairment in the carrying value of goodwill or other intangible assets;
|
•
|
our dependence upon third-party suppliers whose failure to perform timely could adversely affect our business operations;
|
•
|
the highly competitive nature of the markets in which we operate;
|
•
|
environmental compliance costs and liabilities;
|
•
|
potential work stoppages and other labor matters;
|
•
|
access to public and private sources of debt financing;
|
•
|
our inability to protect our intellectual property in the U.S., as well as in foreign countries; and
|
•
|
obligations under our defined benefit pension plans.
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk.
|
Item 4.
|
Controls and Procedures.
|
Item 1.
|
Legal Proceedings.
|
Item 1A.
|
Risk Factors
|
•
|
instability in a specific country's or region's political or economic conditions, particularly economic conditions in Europe, and political conditions in Russia, the Middle East, North Africa, Latin America and other emerging markets;
|
•
|
difficulty in administering and enforcing corporate policies, which may be different than the customary business practices of local cultures.
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds.
|
|
Total Number of Shares Purchased
|
|
|
Average Price Paid per Share
|
|
Total Number of
Shares Purchased as
Part of Publicly Announced Program
|
|
Maximum Number of
Shares (or
Approximate Dollar
Value) That May Yet
Be Purchased Under
the Program (in millions)
|
|
||||||
Period
|
|
|
|
|
|
|
|
|
|
||||||
January 1 - 31
|
605,965
|
|
|
|
$
|
76.42
|
|
|
605,965
|
|
|
$
|
338.1
|
|
|
February 1 - 28
|
633,691
|
|
(1)
|
|
74.69
|
|
|
553,701
|
|
|
296.6
|
|
|
||
March 1 - 31
|
405,289
|
|
(2)
|
|
78.04
|
|
|
276,757
|
|
|
274.8
|
|
|
||
Total
|
1,644,945
|
|
|
|
$
|
76.15
|
|
|
1,436,423
|
|
|
|
|
(1)
|
Includes 77,878 shares that were tendered by employees to satisfy minimum tax withholding amounts for Restricted Shares at an average price per share of $73.29, and includes 2,112 shares purchased at a price of $81.64 per share by a rabbi trust that we established in connection with our director deferral plans, pursuant to which non-employee directors may elect to defer directors’ quarterly cash compensation to be paid at a later date in the form of common stock.
|
(2)
|
Includes 128,532 shares that were tendered by employees to satisfy minimum tax withholding amounts for Restricted Shares at an average price per share of $76.40.
|
Item 6.
|
Exhibits
.
|
|
|
FLOWSERVE CORPORATION
|
|
|
|
|
|
Date:
|
April 23, 2014
|
/s/ Mark A. Blinn
|
|
|
|
Mark A. Blinn
|
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
|
Date:
|
April 23, 2014
|
/s/ Michael S. Taff
|
|
|
|
Michael S. Taff
|
|
|
|
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
Exhibit No.
|
|
Description
|
|
|
|
31.1+
|
|
Certification of Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
31.2+
|
|
Certification of Principal Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.1++
|
|
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.2++
|
|
Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
---|
DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
---|
No information found
No Customers Found
Suppliers
Price
Yield
Owner | Position | Direct Shares | Indirect Shares |
---|