Flowserve Corporation (‘Flowserve’) is a manufacturer and aftermarket service provider of comprehensive flow control systems.
The company develops and manufactures precision-engineered flow control equipment integral to the movement, control, and protection of the flow of materials in its customers’ critical processes. The company’s product portfolio of pumps, valves, seals, automation, and aftermarket services supports global infrastructure industries, including oil and gas, chemical, power ge...
Flowserve Corporation (‘Flowserve’) is a manufacturer and aftermarket service provider of comprehensive flow control systems.
The company develops and manufactures precision-engineered flow control equipment integral to the movement, control, and protection of the flow of materials in its customers’ critical processes. The company’s product portfolio of pumps, valves, seals, automation, and aftermarket services supports global infrastructure industries, including oil and gas, chemical, power generation, nuclear, and water management, as well as certain general industrial markets where its products and services enable customers to achieve their goals. Through the company’s manufacturing platform and global network of Quick Response Centers (‘QRCs’), it offers a broad array of aftermarket equipment services, such as installation, advanced diagnostics, and turnkey maintenance programs.
Strategies
The company has a clear growth strategy as it transforms its operations to better meet its customers' needs. The company maintains a strategic plan that takes a balanced approach to integrating both short-term and long-term initiatives and accelerates growth through three key areas: diversification, decarbonization, and digitization (the ‘3D Strategy’). In addition, the company recently launched the Flowserve Business System to guide the enterprise on incorporating best in class operational practices within the following categories: People Excellence; Operational Excellence; Portfolio Excellence; Commercial Excellence; and Innovation Excellence (the ‘Flowserve Business System’).
Business Segments and Products
Primary Industries
The company sells its products and services to over 10,000 customers, including some of the world’s leading engineering, procurement, and construction firms (‘EPC’), original equipment manufacturers, distributors, and end users. The company’s products and services are used in several distinct industries, having a broad geographic reach.
Sales Channels
Sales to EPC firms and original equipment manufacturers are typically for large project orders and critical applications, as are certain sales to distributors. Project orders are typically procured for customers either directly from the company or indirectly through contractors for new construction projects or facility enhancement projects that are longer-cycle projects and can take up to two years.
In contrast to large project orders, the quick turnaround business, which the company also refers to as ‘short-cycle,’ is defined as orders that are received from the customer (booked) and shipped generally within six months of receipt. These orders are typically for more standardized, general-purpose products, parts, or services, and are less cyclical than larger capital expenditures driven by project orders. Each of the company’s two business segments generates certain levels of this type of short-cycle business.
In the sale of aftermarket products and services (collectively referred to as "aftermarket"), the company benefits from a large installed base of its original equipment, which requires periodic maintenance, repair and replacement parts. The company uses its manufacturing platform and global network of Quick Response Centers (‘QRCs’) to offer a broad array of aftermarket equipment services, such as installation, advanced diagnostics, and turnkey maintenance.
The company has pursued a strategy of industry diversity and geographic breadth to mitigate the impact on its business of normal economic downturns in any one of the industries or in any particular part of the world it serves. In addition, to augment the company’s focus on growth, it has initiated the 3D Strategy to create a more balanced portfolio, supporting customers through the energy transition and leveraging technology and data to improve customer operations and provide solutions.
Business Segments
The company operates through two segments: Flowserve Pumps Division and Flow Control Division.
Flowserve Pumps Division
The company’s largest business segment is the Flowserve Pumps Division (‘FPD’), through which it designs, manufactures, pretests, distributes, and services highly custom-engineered pumps, pre-configured industrial pumps, pump systems, mechanical seals, and auxiliary systems (collectively referred to as ‘original equipment’) and related services. FPD products and services are primarily used by companies that operate in the oil and gas, power generation, chemical, water management, and general industries. The company markets its pump and mechanical seal products through its global sales force and its regional QRCs and service and repair centers, or through independent distributors and sales representatives. A portion of its mechanical seal products is sold directly to other original equipment manufacturers for incorporation into their rotating equipment requiring mechanical seals.
The company’s pump products are manufactured in a wide range of metal alloys and with a variety of configurations to reliably meet the operating requirements of its customers. Mechanical seals are critical to the reliable operation of rotating equipment in that they prevent leakage and emissions of hazardous substances from the rotating equipment and reduce shaft wear on the equipment caused by the use of non-mechanical seals. The company also manufactures a gas-lubricated mechanical seal that is used in high-speed compressors for gas pipelines and in the oil and gas production and process markets. The company’s products are manufactured in 37 manufacturing facilities worldwide, 12 of which are located in North America, 11 in Europe and the Middle East, eight in the Asia Pacific and six in Latin America; and it has 130 QRCs, including those co-located in manufacturing facilities and/or shared with its Flow Control Division (‘FCD’).
The company also conducts business through strategic foreign joint ventures. It has five unconsolidated joint ventures that are located in Chile, India, Saudi Arabia, South Korea, and the United Arab Emirates, where a portion of its products is manufactured, assembled, or serviced in these territories. These relationships provide numerous strategic opportunities, including increased access to its current and new markets, access to additional manufacturing capacity, and expansion of its operational platform to support best-cost sourcing initiatives and balance capacity demands for other markets.
FPD Products
The company manufactures approximately 150 active pump models, including American Petroleum Institute (‘API’) process pumps used in many downstream refining and petrochemical processing systems, and single case multistage axially split heavy-duty pumps often used for high-pressure hydrocarbon pipeline transmission. In addition, it manufactures double case diffuser-style barrel pumps for medium duty applications in refining and petrochemical applications and submersible pumps for deep well pumping in irrigation and municipal water supply service. The company also manufactures approximately 190 active mechanical seal and sealing systems models. The company’s pump products are sold under globally recognized brands, including Worthington, SIHI, Durco, and Innomag.
FPD Services
The company also provides engineered aftermarket services through its global network of 130 QRCs, some of which are co-located in manufacturing facilities, in 45 countries. The company’s FPD service personnel provide a comprehensive set of equipment services for flow management control systems, including installation, commissioning services, seal systems spare parts, repairs, advanced diagnostics, re-rate and upgrade solutions, retrofit programs, machining, and comprehensive asset management solutions. The company provides asset management services and condition monitoring for rotating equipment through special contracts with many of its customers. A large portion of FPD’s service work is performed on a quick response basis, and it offers 24-hour service in all of its major markets.
FPD Customers
The company’s customer mix is diversified and includes leading EPC firms, major national and international companies, equipment end users in its served markets, other original equipment manufacturers, distributors, and end users. The company’s sales mix of original equipment products and aftermarket products and services diversifies its business and helps mitigate the impact of normal economic cycles on its business. The company’s sales are diversified among several industries, including oil and gas, power generation, chemical, water management, and general industries.
FPD Competition
Some of the company’s largest industry competitors include: Sulzer Pumps, Ebara Corp., Eagle Burgmann, which is a joint venture of two traditional global seal manufacturers, John Crane Inc., a unit of Smiths Group Plc, Weir Group Plc, ITT Industries, and KSB SE & Co. KGaA.
Flow Control Division
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 services and equipment. FCD leverages its experience and application know-how by offering a complete menu of engineered services to complement its expansive product portfolio. FCD products are used to control, direct, and manage the flow of liquids, gases, and multi-phase fluids, and are a critical part of any flow control system. The company’s valve and automation products are based on flexible architecture that can be customized or engineered to perform specific functions within each customer’s unique flow control environment or objective.
The company’s flow control products are primarily used by companies operating in the chemical, power generation, oil and gas, water management, and general industries, including the growing mining industry. The company’s products are manufactured in 19 principal manufacturing facilities, seven of which are located in Europe, six located in the United States, five located in Asia Pacific and one located in Latin America. It delivers its services through its global network of 27 QRCs worldwide, including nine sites in North America, eight in Asia Pacific, six in Europe and Africa, three in the Middle East and one in Latin America, including those co-located in manufacturing facilities.
FCD Products
The company’s valve, automation, and controls products and engineered services portfolio represent one of the most comprehensive offerings in the flow control industry. The company’s products are used in a wide variety of applications, from general service to the most severe and demanding services, including those involving high levels of corrosion, extreme temperatures and/or pressures, zero fugitive emissions, and emergency shutdown.
The company’s ‘smart’ valve and diagnostic technologies integrate sensors, microprocessor controls, and software into high-performance integrated control valves, digital positioners, and switch boxes for automated on/off valve assemblies and electric actuators. These technologies permit real-time system analysis, system warnings, and remote indication of asset health. The company is committed to further enhancing the quality of its product portfolio by continuing to upgrade its existing offerings with cutting-edge technologies.
The company’s valve actuation products encompass a broad range of pneumatic, electric, hydraulic, and stored energy actuation designs to take advantage of the power source the customer has available, including utilizing the process fluid flowing through the pipeline as a source of power to actuate the valve. The company’s actuation products also cover one of the widest ranges of output torques in the industry, providing the ability to automate anything from the smallest linear globe valve to the largest multi-turn gate valve. Most importantly, FCD combines best-in-class mechanical designs with the latest in controls and communication technologies in order to provide complete integrated automation solutions that optimize flow control performance and enhance digital end-user experience.
The company manufactures approximately 30 different active types of products, including valves, actuators, positioners, and switches. The company’s products are sold under globally recognized brands, including Valtek, Argus, Worcester, Limitorque, and Durco.
FCD Services
The company’s service personnel provide comprehensive equipment maintenance services for flow control systems, including advanced diagnostics, repair, installation, commissioning, retrofit programs, and field machining capabilities. A large portion of the company’s service work is performed on a quick response basis, which includes 24-hour service in all of its major markets. The company also provides in-house repair and return manufacturing services worldwide through its manufacturing facilities.
During 2022, the company added the service of condition monitoring for its control valves, which is enabled by RedRaven, its proprietary IIoT solution, and digital positioners.
FCD Customers
The company’s customer mix spans several end markets, including the chemical, power generation, oil and gas, water management, and other general industries, which include mining. The company is especially active in providing solutions for emerging applications that support sustainability (such as concentrated solar power, hydrogen economy, carbon capture, desalination, etc.) or increase energy productivity (such as LNG, Ethylene cracking, and Hydro cracking, etc.). Lastly, the company’s expertise in flow control management makes it a reliable partner to assist its customers with energy transition – by either making their processes more efficient and sustainable, or by providing products and solutions for new technologies that enable energy transition.
The company’s product offerings include original equipment, aftermarket parts, and a portfolio of services and solutions. Contracts and transactions are conducted through a variety of channels depending on customer requirements, including direct end-users, EPC firms, distributors, and other original equipment manufacturers.
Seasonality
The company’s financial results are seasonal, as it typically experiences lower earnings in the first quarter of the year, with lower sales, coupled with fixed operating expenses impacting its earnings and cash flows. The company typically has higher sales, earnings, and cash flows in the second half of the year (fiscal year ended December 31, 2024).
Selling and Distribution
The company primarily distributes its products through direct sales by employees assigned to specific regions, industries, or products. In addition, it uses distributors and sales representatives to supplement its direct sales force where it is more economically efficient. The company generates a majority of its sales leads through existing relationships with vendors, customers, and prospects, or through referrals.
Research and Development Expense
The company’s aggregate research and development costs were $69.9 million in 2024.
History
Flowserve Corporation was founded in 1790. The company was incorporated in the state of New York in 1912.