2013-02-21 22:04:41 -
Announces a 16.7% quarterly dividend increase to 42 cents per share
Buyback program authorization replenished to $750 million
Approves a 3-for-1 stock split, subject to shareholder action
DALLAS, February 21, 2013 - Flowserve Corp. (NYSE:FLS), a leading provider of
flow control products and services for the global infrastructure markets,
announced today that its Board of Directors has recently approved certain key
planned corporate actions, including a 16.7% increase in its quarterly dividend
to 42 cents per share, a replenished stock repurchase authorization to $750
million and a 3-for-1 stock split, subject to shareholder action.
"Flowserve has a strong record of delivering value to our shareholders,"
indicated Mark Blinn, president and chief executive officer. "Since the start of
2008, we have returned over $1.5 billion to our shareholders through dividends
and share buybacks,
while simultaneously investing in the business, maintaining
a prudent balance sheet, completing targeted acquisitions and delivering
earnings growth. We have also demonstrated the ability to generate substantial
free cash flow, even during historically difficult periods of the business
cycle. Today's announced actions reflect both our ongoing commitment to
providing value to our shareholders, as well as confidence in our ability to
generate long-term profitable growth and solid cash flows."
Increase in Quarterly Dividend
Flowserve announced today that its Board of Directors has authorized the payment
of a quarterly cash dividend of $0.42 per share on the company's outstanding
shares of common stock. The quarterly cash dividend increased from $0.36 per
share, or 16.7% over the previous quarterly rate.
The dividend is payable on April 12, 2013, to shareholders of record as of the
close of business on March 28, 2013. Future dividend payments would be
proportionately adjusted for any effected stock split.
While Flowserve currently intends to pay regular quarterly cash dividends for
the foreseeable future, any future dividends, whether at this $0.42 per share
quarterly rate (equivalent to $0.14 per share assuming the proposed 3-for-1
split is effected) or otherwise, will be reviewed individually and declared by
the Board at its discretion, dependent on the Board's assessment of the
company's financial condition and business outlook at the applicable time.
Stock Repurchase Program Replenished
Flowserve also announced that its Board of Directors has approved a replenished
stock repurchase authorization of $750 million, inclusive of approximately $193
million remaining under the prior $1 billion program authorized in 2012.
Execution of the company's share repurchases is ongoing, with completion of the
remaining amounts under the prior program expected to occur during the 2013
second quarter. The company then anticipates the remaining authorized amount,
approximately $557 million, will be utilized under its previously announced
policy of annually returning 40% to 50% of its running two-year average net
earnings to shareholders while maintaining its target leverage ratio.
The amount and timing of the planned repurchases will be determined by the
company based on its evaluation of its financial condition, business
opportunities and market conditions at the time. The repurchases may be
effected through various methods, including open market repurchases (including
those effected through Rule 10b5-1 plans to allow longer periods of repurchase
Approved 3-for-1 Stock Split
Flowserve's Board of Directors recently approved a 3-for-1 stock split.
Implementation of the stock split is subject to shareholders' approval of an
amendment to the company's certificate of incorporation to increase the number
of authorized shares of the company's common stock. This amendment, which would
enable the recommended stock split, will be voted on by the shareholders at
Flowserve's 2013 Annual Meeting of Shareholders expected to be held May
If approved as recommended by the Board, the record date is expected to be on or
about June 7, 2013. Each shareholder of record on the record date will receive
two additional shares of common stock for each share held. Flowserve anticipates
the additional shares will be distributed by the end of July 2013 if approved.
Additional details of the 2013 Annual Meeting of Shareholders and the proposed
stock split will be included the company's proxy statement, which is expected to
be filed in early April 2013.
Mike Mullin, Director, Investor Relations, (972) 443-6636
Jay Roueche, Vice President, Investor Relations & Treasurer, (972) 443-6560
Steve Boone, Director, Global Communications and Public Affairs, (972) 443-6644
About Flowserve: Flowserve Corp. is one of the world's leading providers of
fluid motion and control products and services. Operating in more than 55
countries, the company produces engineered and industrial pumps, seals and
valves as well as a range of related flow management services. More information
about Flowserve can be obtained by visiting the company's Web site at
Safe Harbor Statement: This news release includes forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934, which are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995, as
amended. Words or phrases such as, "may," "should," "expects,"
"intends," "plans," "anticipates," "estimates,"
"predicts" or other similar expressions are intended to identify forward-looking
statements, which include, without limitation, earnings forecasts, statements
relating to our business strategy and statements of expectations, beliefs,
future plans and strategies and anticipated developments concerning our
industry, business, operations and financial performance and condition.
The forward-looking statements included in this news release are based on our
current expectations, projections, estimates and assumptions. These statements
are only predictions, not guarantees. Such forward-looking statements are
subject to numerous risks and uncertainties that are difficult to predict.
These risks and uncertainties may cause actual results to differ materially from
what is forecast in such forward-looking statements, and include, without
limitation, the following: 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 taking 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; our ability to execute and realize the expected financial
benefits from our strategic realignment initiatives; economic, political and
other risks associated with our international operations, including military
actions or trade embargoes that could affect customer markets, particularly
Middle Eastern markets and global oil and gas producers, and non-compliance with
U.S. export/re-export control, foreign corrupt practice laws, economic sanctions
and import laws and regulations; our exposure to fluctuations in foreign
currency exchange rates, including in hyperinflationary countries such as
Venezuela; our furnishing of products and services to nuclear power plant
facilities; 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 foreign subsidiaries autonomously
conducting limited business operations and sales in certain countries identified
by the U.S. State Department as state sponsors of terrorism; 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; our inability to protect our
intellectual property in the U.S., as well as in foreign countries; obligations
under our defined benefit pension plans; and other factors described from time
to time in our filings with the Securities and Exchange Commission.
All forward-looking statements included in this news release are based on
information available to us on the date hereof, and we assume no obligation to
update any forward-looking statement.
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Source: Flowserve Corporation via Thomson Reuters ONE