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Flowserve's CEO Discusses Q3 2011 Results - Earnings Call Transcript

Joining us today are Mark Blinn, President and CEO of Flowserve; Tom Ferguson, President of the Flow Solutions Group; Tom Pajonas, President of the Flow Control Division; and Dick Guiltinan, Senior Vice President of Finance and Chief Accounting Officer. Following our commentary, we will begin the Q&A session.

Regarding any forward-looking statements, I refer you to yesterday's earnings release and the 10-Q filing and today's earnings presentation slide deck for Flowserve's Safe Harbor statement on this topic. All of this information can be found on Flowserve's website under the Investor Relations section. I encourage you to read these statements carefully with respect to the conference call this morning. The information in this conference call, including all statements by management, plus our answers to questions related in any way to projections or any other forward-looking statements, are subject to Flowserve's Safe Harbor.

Now I would like to turn it over to Mark to begin the formal presentation. Mark?

Mark A. Blinn

Thank you, Mike, and good morning, everyone. I am pleased with our solid third quarter performance, despite continuing challenging macroeconomic conditions. We had high revenues across each of our 3 business segments, improved our operating income and reported higher earnings per share over last year. We also posted double-digit growth in our bookings versus prior year as demand improved in several key markets. I thank our employees whose hard work played a significant role in our solid performance this quarter.

Our short cycle business remains strong, with increased volume in the chemical, general industries and oil and gas markets and stable opportunities in our power market. In our long cycle business, we saw a steady improvement with smaller projects, but the very large projects remain competitive. Although our long cycle business is stabilized, we continue to see some customers delay the release of certain large infrastructure projects, which we expect will ultimately go forward. Selective bidding on the large infrastructure projects, which have been released, has helped us firm up our pricing. We delivered record quarterly aftermarket bookings, underscoring the success of our end-user strategies, which are focused on supporting our customers' repair, service and upgrade need. These strategies, which include our global QRC footprint, allow us to offer our customers' repair and upgrade services when and where those services are needed. Bottom line, is that our focus on expanding our global QRC footprint and growing our service capabilities is paying off.

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