For the first quarter of 2016, Flowserve announced Adjusted EPS of $0.39 on revenues of $947 million. Adjusted gross and operating margins were 33.3% and 9.4%, respectively. First quarter Adjusted EPS includes $0.03 of negative currency translation and $0.07 for distinct SG&A expenses, but excludes the impact of realignment expenses of $0.07, negative below-the-line currency impact of $0.02 and $0.01 of SIHI purchase price accounting and integration costs.
On a reported basis, earnings for the first quarter were $0.29 per share, compared to $0.20 per share in the 2015 first quarter. Commenting on first quarter 2016 performance, Karyn Ovelmen, Flowserve’s executive vice president and chief financial officer said, “Cash flows from operations improved over $85 million for our seasonally weakest quarter, and free cash flow increased almost $150 million versus the comparable prior year period. Incorporating SIHI’s operational performance, combined with the loss of fixed cost leverage from reduced project activity and the 140 basis points from distinct SG&A expenses, were among the factors impacting our margin performance in the quarter. While the recognition of our realignment savings gets temporarily affected by timing and some delays due to ongoing negotiations, we are confident in the significant actions we are taking to successfully drive costs out of our business and to better position our company for long-term margin improvement.”