Flowserve Corporation (FLS) Earnings Call Transcript & Summary

Welcome to the Flowserve 2021 Annual Meeting. I would now like to introduce the first presenter, Mr. Scott Rowe, President and CEO of Flowserve Corporation.

Thank you, and good morning, everyone. I'm Scott Rowe, President and CEO of Flowserve. It is my pleasure to welcome you to the Flowserve 2021 Annual Shareholders Meeting. We are holding today's annual meeting as a virtual-only meeting for the second time in Flowserve's history due to various local, state and federal guidelines to limit the spread of COVID-19 as the pandemic continues to cause challenges around the globe. While the meeting is virtual only, we welcome questions from our shareholders. You are permitted to submit your questions through the online portal. They will be reviewed during the meeting, and assuming they comply with our meeting rules of conduct will be addressed during the Q&A portion of the meeting. Though we may not be able to answer every question, we will do our best to provide a response to as many as possible time permitting. At this time, I'll turn the meeting over to Roger Fix, Chairman of Flowserve's Board of Directors to call this meeting to order. Mr. Fix?

Thanks, Scott. Good afternoon, and welcome to Flowserve's 2021 Annual Meeting of Shareholders. As a Chairman, I call this meeting to order. We're now going to address the matters to be voted on at this meeting. This meeting will be conducted in accordance with the agenda and rules of conduct that have been posted on the virtual meeting website to assure fairness to all shareholders in attendance and an orderly meeting. We ask that participants abide by these rules, and thank you for your cooperation. Please also remember that you may vote your shares online at any time during this meeting prior to the closing of the polls. The polls opened at the beginning of the meeting, and we will close the polls on all matters immediately after the presentation and discussion of today's proposals. I'd like to start by recognizing the members of our Board standing for election at this annual meeting, all of whom are in attendance at this meeting. We're also joined at this meeting by Lanesha Minnix, Chief Legal Officer and Corporate Secretary, who is acting as Secretary of this meeting. Also attending is Pat Alford from PricewaterhouseCoopers, Flowserve's independent registered public accounting firm. He'll be available to respond to questions at the end of the meeting. [ Natalie Hairston ] of American Election Services will serve as the inspector of elections. She has previously taken her oath as inspector. We'll now move on to the formal portion of this meeting. Lanesha will now report on the mailing of Notice of the Meeting and the presence of a quorum.

Thank you, Roger. With me, I have a list of shareholders entitled to receive notice of and to vote at this meeting. This list is certified by EQ Shareowner Services, the company's registrar and transfer agent as of March 26, 2021, the record date set for this meeting. The certified list of shareholders is also with Ms. Hairston and is available for review. Additionally, I hold the Notice of the 2021 Annual Meeting of Shareholders of Flowserve Corporation to be held this date and the 2021 proxy statement relating to this meeting, both dated April 9, 2021. Finally, I also hold an affidavit of mailing signed by Broadridge, the mailing agent, dated April 9, 2021, confirming that the company's annual Report, Notice of Annual Meeting of Shareholders, proxy statement and proxy card were all made available beginning on April 9, 2021, to each shareholder of record at the close of business on the record date. Today, there are present in person or by proxy, the holders of at least 123,357,143 shares or 94.47% of the 130,568,916 shares entitled to vote at this meeting. Accordingly, a quorum is present. This meeting is duly convened for the purposes of transacting business properly before it.

Thank you, Lanesha. The next order of business is a brief description of the matters properly brought before this meeting. All the following proposals are listed on the meeting agenda and are described in the proxy materials. We have 4 proposals, which I will briefly describe. The Board recommends you vote for each of proposals 1, 2, 3 and 4. The first proposal is the election of 10 directors to the Board of Directors for a term expiring at the 2022 Annual Meeting of Shareholders. The second proposal is the advisory vote on the compensation of our executive officers identified in the proxy statement or the say-on-pay vote. The third proposal is the ratification of PricewaterhouseCooper's appointment to serve as Flowserve's independent registered public accounting firm for 2021. The fourth proposal is the approval and amendment to the certificate of incorporation to delete Article 10 regarding supermajority approval of business combinations with certain interested parties. We'll now see if there are any questions or comments regarding these proposals.

Roger, at this time, there are no questions from our shareholders regarding these proposals.

We will close the poll shortly. If you previously voted on the Internet or by telephone, or if you delivered your proxy card, your shares will be voted accordingly, and you do not need to vote today unless you wish to change your vote. [Voting]

Now that everyone has had the opportunity to vote, I now declare the polls are closed. Lanesha, will you please give us the preliminary voting results?

The preliminary report of the inspector of election shows that for Proposal 1, each of our Director nominees received at least 97.2% of votes cast on this proposal in favor of his or her election. For Proposal 2 of the shares of common stock voted on this proposal, approximately 96.9% were voted in favor of approving the compensation of our named executive officers. For Proposal 3 of the shares of common stock voted on this proposal, approximately 97.5% were voted to ratify the appointment of PricewaterhouseCoopers. For Proposal 4 of the shares of common stock outstanding, approximately 99.7% were voted to approve the amendment to the certificate of incorporation of Flowserve Corporation.

Thank you, Lanesha. The results indicate that Flowserve shareholders have elected each of the director nominees and have approved Proposals 2, 3 and 4. As there is no further official business, we now adjourn the formal portion of the meeting. We'll now address questions of general interest from our shareholders that comply with our meeting rules of conduct posted on our virtual meeting website. Each shareholder will be limited to a total of 3 questions. No more than one question may be on a single topic. If not already submitted your questions, please do so now. Our Assistant Corporate Secretary, Akshar Patel has been monitoring the submitted questions and will read each question appropriate for discussion at this meeting, and Scott with support from the other members of management as needed will respond. Akshar, are there any questions from our shareholders?

Roger, we have not received any questions from our shareholders to be discussed at this meeting.

Thank you, Akshar. This concludes our 2021 Annual Shareholder Meeting.

Thank you. The Annual Meeting for Flowserve Corporation Inc. has now come to an end. Thank you for attending. You may now disconnect.