Flowserve (FLS) Citi's Global Industrial Tech & Mobility Conference 2026 summary

Strategic transformation and margin improvement

• Achieved 500 basis points of margin improvement over three years, surpassing 2027 targets and prompting new 2030 goals.

• Implemented a global business unit structure and launched a business system in 2023, including the 80/20 program, which went fully live in 2024.

• Set 2030 targets: mid-single-digit organic sales growth, 100 basis points annual margin expansion, 20% operating income, and double-digit adjusted EPS growth.

• Operational Excellence and Portfolio Excellence (80/20) are key pillars, with facility consolidation and process improvements driving productivity.

• Commercial Excellence initiatives include retraining the sales force, new incentive plans, and enhanced CRM usage to drive growth.

Portfolio optimization and growth focus

• 80/20 program fully implemented across all product business units by 2025, focusing on A products and best customers.

• Facility footprint optimization is ongoing, with successful consolidations and a dynamic multi-year plan to drive efficiency.

• 80/20 program caused short-term revenue headwinds but is expected to drive outsized growth as focus shifts to high-value segments.

• Aftermarket business is growing at mid- to high-single digits, supported by improved data, speed, and service capabilities.

Market outlook and end-market diversification

• End markets are constructive, with growth expected in the Middle East, power (including nuclear), and general industries.

• Nuclear bookings reached $400 million in 2025, mainly from life extensions and re-rates; greenfield projects and SMRs represent future upside.

• Acquisition of Trillium's valve division increases nuclear content per reactor by 15-20%, enhancing growth potential.

• General industries and water are targeted for steady growth, with a focus on configured products and regional expansion.