Flowserve Acquires LNG Pumping Technology from NexGen Cryo to Accelerate Decarbonization Growth Strategy

DALLAS--(BUSINESS WIRE)-- Flowserve Corporation (“Flowserve”) (NYSE: FLS), a leading provider of flow control products and services for the global infrastructure markets, has acquired the intellectual property and in-process R&D related to cryogenic Liquefied Natural Gas (LNG) submerged pump technology, systems and packaging from NexGen Cryogenic Solutions, Inc. (“NexGen Cryo”), a privately held, Arizona-based company specialized in the engineering, design and testing of LNG pumps and turbines.

NexGen Cryo’s pump and cold energy recovery turbine (CERT) technology for the liquefaction, shipping and regasification markets is expected to meaningfully differentiate and expand Flowserve’s LNG product portfolio and complement its existing pumps, valves and mechanical seals offering.

“LNG provides a resilient pathway to energy transition. As we continue advancing our 3D growth strategy to diversify, decarbonize and digitize, this technology acquisition will strengthen our decarbonization offerings across the LNG value chain,” said Scott Rowe, Flowserve’s President and Chief Executive Officer. “We look forward to leveraging our new state-of-the-art LNG pump facility with our existing network of more than 150 quick response centers to commercialize this LNG product offering to our customers.”

Dennis Chalmers, President and Chief Executive Officer of NexGen Cryo commented, “With over 300 years of combined cryogenic pump team experience, we are excited in the potential for this next-generation technology to provide LNG customers across the globe improved efficiency, increased reliability and reduced operating expenditures. I am excited for the next phase of this technology.”

Transaction Details
The technology acquisition closed during the third quarter of 2024. The purchase price and associated expenses are expected to reduce adjusted earnings per share by $0.05 in Flowserve’s 2024 third quarter. NexGen Cryo’s technology is now part of Flowserve’s Pumps Division.

About Flowserve
Flowserve Corporation is one of the world’s leading providers of fluid motion and control products and services. Operating in more than 50 countries, the company produces engineered and industrial pumps, seals and valves as well as a range of related flow management services. More information about Flowserve can be obtained by visiting the company’s website at www.flowserve.com.

About NexGen Cryo
NexGen Cryogenic Solutions, Inc. specializes in the engineering, design and testing of LNG submerged pumps and turbines. More information about NexGen Cryo can be obtained by visiting the company’s website at www.nexgencryo.com.

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The forward-looking statements included in this news release are based on our current expectations, projections, estimates and assumptions. These statements are only predictions, not guarantees. Such forward-looking statements are subject to numerous risks and uncertainties that are difficult to predict. These risks and uncertainties may cause actual results to differ materially from what is forecast in such forward-looking statements, and include, without limitation, the following: economic, political and other risks associated with our international operations, including military actions, trade embargoes, epidemics or pandemics or changes to tariffs or trade agreements that could affect customer markets, particularly North African, Latin American, Asian and Middle Eastern markets and global oil and gas producers, and non-compliance with U.S. export/re-export control, foreign corrupt practice laws, economic sanctions and import laws and regulations; any continued volatile regional and global economic conditions resulting from the COVID-19 pandemic on our business and operations; global supply chain disruptions and the current inflationary environment could adversely affect the efficiency of our manufacturing and increase the cost of providing our products to customers; a portion of our bookings may not lead to completed sales, and our ability to convert bookings into revenues at acceptable profit margins; changes in global economic conditions and the potential for unexpected cancellations or delays of customer orders in our reported backlog; our dependence on our customers’ ability to make required capital investment and maintenance expenditures; if we are not able to successfully execute and realize the expected financial benefits from any restructuring and realignment initiatives, our business could be adversely affected; the substantial dependence of our sales on the success of the oil and gas, chemical, power generation and water management industries; the adverse impact of volatile raw materials prices on our products and operating margins; increased aging and slower collection of receivables, particularly in Latin America and other emerging markets; our exposure to fluctuations in foreign currency exchange rates, including in hyperinflationary countries such as Venezuela and Argentina; potential adverse consequences resulting from litigation to which we are a party, such as litigation involving asbestos-containing material claims; expectations regarding acquisitions and the integration of acquired businesses; the potential adverse impact of an impairment in the carrying value of goodwill or other intangible assets; our dependence upon third-party suppliers whose failure to perform timely could adversely affect our business operations; the highly competitive nature of the markets in which we operate; environmental compliance costs and liabilities; potential work stoppages and other labor matters; access to public and private sources of debt financing; our inability to protect our intellectual property in the U.S., as well as in foreign countries; obligations under our defined benefit pension plans; our internal control over financial reporting may not prevent or detect misstatements because of its inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud; the recording of increased deferred tax asset valuation allowances in the future or the impact of tax law changes on such deferred tax assets could affect our operating results; our information technology infrastructure could be subject to service interruptions, data corruption, cyber-based attacks or network security breaches, which could disrupt our business operations and result in the loss of critical and confidential information; ineffective internal controls could impact the accuracy and timely reporting of our business and financial results; and other factors described from time to time in our filings with the Securities and Exchange Commission.

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The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company's performance. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.

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Investors:

Jay Roueche, Vice President, Investor Relations & Treasurer (972) 443-6560

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Media:

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Source: Flowserve Corporation