Good afternoon, everyone. Thanks for taking the time to join us today. My name is Joe Giordano. I cover industrials here at TD Cowen. Thanks for joining our second annual virtual sustainability conference. For this presentation, if you wanna ask a question, you can do it directly through the application, I'll get it popped up on my screen here. Or you can just email me, it's joe.giordano@tdsecurities.com, and I will just do this in the beginning, and apologies ahead of time, but we're at that time of year, so if you see on my screen there on this side, we're in II season. Hopefully, we've done enough for you guys to get a five-star vote this year. If you voted for us in the past, we really appreciate it, and we look forward to trying to earn that each and every year from you, so thank you. So to start out, we have one of our top picks with us here today. Very happy to have Scott Rowe, President and CEO of Flowserve. So we're gonna kick things off with Scott with a couple of prepared remarks, and then we'll jump into topics. But like I said, anytime you have a question, shoot it my way, and we'll put it in for me. So thanks everyone. Scott, I'll turn it over to you, and we'll get going. Yeah, great. Thank you, Joe. We appreciate you having me, and thanks to TD Cowen for the support and letting us participate today. Given that it is a sustainability conference, I wanted to talk about our ESG report just real quickly, and then we'll jump into Q&A. But this went out, gosh, two weeks ago now. We're labeling it Extraordinary Impact, and I think probably the coolest thing is the ESG report is very much aligned with our 3D strategy of diversify, decarbonize, and digitize. And so very much aligned with what we're trying to do as an organization, and I'd just say that this report really tells the story of what we're trying to do with climate, what we're doing internally with our culture, and what we do with the core responsibility or the governance aspect of our business. Some of the highlights, we put out a 2030 target for CO2 emissions intensity. We, we've exceeded that now in our first three years, and so we're now at 46%, so we'll need to come out with a new target this year. But a really great effort on, you're really driving intensity down. And then I'd just say our, our net carbon emissions also went down in this period, so really good work. Our safety program continues to be world-class. Our TRIR or TRR is 0.32, and for an industrial company, that's in the top kinda 10%, if not higher, and so we're doing a really good job looking after our global workforce of over 17,000 people. And then on the bottom there, we do a really nice job with Flowserve Cares, giving back to the communities where we live and work, and we take that very seriously, and we've got a very robust effort there. And it's not just dollars, it's more about volunteer service, working with STEM education in various parts of the world, and some of the disaster relief, 'cause, you know, we're working in all kinds of crazy places. Inevitably, something's happening, and we're doing a lot to give back. So we've gotten a lot of recognition. We're in the kind of the top quartile or top half of all industrials now when we think about our ESG program. And again, probably most importantly, what we're doing with ESG is very much aligned with our 3D strategy, helping our customers to diversify or decarbonize big assets, working on diversification programs, and then ultimately, you know, making the world a better place through our flow control technology. So with that, y'all, I'll take the slide down, and happy to jump into any questions. Perfect. Let me just unmute myself. There we go. Yeah, no, and I think what you, what you said there, it, it lines up well with what we're trying to do here. Like, where you have a really in-depth sustainability effort internally, but part of why this is interesting for this conference is, like, sustainability is kind of at the core of what you do and what you kind of provide for your own- Yeah Customers. Absolutely. So I think that, that does really nicely. You know, it's, it's funny, when I was writing up topics, you've been at Flowserve for a while now. It doesn't feel like it's been that long. I remember when you came on, and I guess it was making us both feel old, I guess. But, Definitely getting older. It- Seven years now at Flowserve. It's crazy. The company's on firm footing now. It seems clear. It's not just a one-quarter phenomenon that we've seen. It likely took longer than you probably thought when you came on board. But outside of things like COVID, which I know derailed momentum that you had earlier on, what maybe did you underestimate a little bit stepping in, and what do you think you're getting right currently as an organization? Yeah, sure. I'd say it does. I mean, some days it feels like it was yesterday that I just showed up, but it has been 7 years now, and we've gone through a lot. And as you said, we're at firm footing is a great way to say it. We've got a lot of positive momentum, so we're heading in the right direction. I'd say at the beginning, what did I not fully appreciate? I'd say just, like, the level of decentralization and lack of process, and then just the systems landscape that was so disparate. And when you're trying to do that and change a culture, instill core values, drive a purpose-driven organization, it was just a lot of change at once. And I'd say we made really, really good progress kinda in those early years, going 2017 to 2018, 2018 to 2019, and I'd say, you know, from a maturity perspective, we had kinda moved up that, that maturity ladder. We were making, you know, great strides across all of the major initiatives, and COVID just ended up kind of really turning us upside down. Our business went down on our bookings about 30%, and then we were, you know, working through the supply chain challenges and all that. But if we fast-forward to now, like, what's working is we've kind of gotten through that the end markets are very supportive, and we can talk about that if we want later on. And we continue to refine the operating model from the, what we were doing in Flowserve 2.0 to what we launched last year. What I would say is I'm really excited about the org design that we put in place last year. So for those that aren't familiar with it, we created seven operating business units, and we did this categorized around our product offering, but more importantly, like that, you know, the industries that we serve, the customers, and the channel to market. We have seven of these. We've got four in the pump side, which is engineered pump, industrial pump, our mechanical seal business, and then services and solutions. On the valve side, we have automation and controls, isolation valves, and services and solutions to do the aftermarket and the MRO there. But that level of focus now with these seven P&Ls and the right resources at that level is really proving to move our business forward, not, you know, strategically, but also operationally. And the business units now have all of the resources that they need to drive growth, to drive customer support, to drive a healthy P&L. And then the other thing we did was some pretty major changes in operational excellence, and so we changed some people out. We've doubled down on process and focus, and again, we made good progress pre-COVID and then kinda got sideways in some of the supply chain challenges, but we're in a really good place now. And so I feel good about, you know, what we're doing, and, you know, as you said, you know, Joe, solid footing. But really, you know, we're kind of now in 6-7 really strong quarters of continued improvement and operational momentum. Well, Joe, I'm not sure what happened, but I can't hear you. I still can't hear you.... Great, thank you. Clearly, we're having some technical difficulties, and we lost Joe. I'll just finish up. I'll wrap up with a few high-level remarks. I'll start with the 3D strategy. It continues to work very favorably. The digitized side has, hasn't gone as fast as I would have wanted. However, we've now instrumented over 2,200 assets around the world, and we're 25% higher than where we were last year, and we think we're at a real inflection point in terms of growth. And we're, you know, we remain committed to digitization. We really like the ability to- to collect data on our assets, pumps, valves, and the mechanical seals. And we believe that ultimately this helps us towards solutions with our, with our customers. Additionally, the digitization side, we feel really good about our ability to, to work internal to our operations and drive, you know, strong efficiencies with the digital perspective. And then on diversify side, maybe a little bit slower than, you know, or a little bit more challenging here to reposition the whole portfolio into diverse markets, but something that we're very much working to do. So think of applications like water, specialty chemical, pharmaceutical, where we've got great products and able to reposition there. And then on the decarbonization side, this is where we're seeing the, the most activity, where we're getting existing assets like a refinery, a chemical plant, where operators are looking to decarbonize that asset. And so reduced energy consumption, carbon capture on the front end or on the back end, maybe a biodiesel or a bioconversion throughout the facility, maybe chemical recycling on the front end, but a lot of different ways that we can help to decarbonize and drive Energy Advantage. Joe, are you back now? Can you, can you hear me? Oh, yeah, there we go! Oh, my God! I can hear you. My, my whole computer crashed. Oh, gosh I don't know what happened there. So good- All right G ood timing. I just gave a 3D overview. That was it. Okay. So we took out one of my questions. Good. Yeah. Apologies for everyone for that. That's embarrassing, but anyway, back at it. So the first question we discussed on, you know, where you guys stand and the momentum you have. On margins, I think that's pretty clear, and I think you could probably look at it two ways. One, you know, you're seeing clear momentum there, but two, they're objectively still kind of on the lower side, right? If you were to compare to broad industrials. So, how do you think about the potential there the next couple of years, and what are the likely contributors to more meaningful expansion? Sure. Yeah, so we put margin targets out with last year at the Analyst Day and Investor Day, and so our target is 14%-16% operating income by 2027, and that's roughly kind of from where we were last year, about 400 basis points from where we are now. But we're making good progress there. And so, you know, we feel very good about, you know, meaty step changes on margin improvement every year. We're doing that on the back of operational excellence, so that's what we see the early results. And then the product management and portfolio management, in the Investor Day, we committed to another 100-200 basis points of margin improvement on the back of that effort. I'd say we're in the very early stages of that, but we feel really good about, you know, those, the product initiatives driving another, you know, upwards of 200 basis points. And then we get up to the, the higher end of our range with just leveraging our scale and continued good cost control, which we've done, you know, pretty much throughout my tenure. So, you know, getting to this 14%-16%, we've got clear line of sight. We're making good progress. We're seeing meaty improvements year-over-year. When we talk about kind of the broader industrial base, that might be upwards of, you know, kind of 16%-18% or even slightly higher, that's gonna really require us on the mergers and acquisition side and the portfolio side, to continue to move more and more into the industrial-type products, and then also continuing to move more and more into our aftermarket, the higher margin. So that's clearly part of the strategy. I would say, you know, right now we're very focused on the 2027 targets that we laid out, but by driving more diverse portfolio, by driving the aftermarket initiatives, we've got the ability to start to walk that up even higher. I know we're a little bit stretched for time now, so I'm gonna kind of go through these a little bit quicker, but I just wanna touch on the sustainability side, just from a messaging standpoint, because I think there's still a lot of debate, and I could tell it when my client discussions of like, where does Flowserve fit into this whole concept? Because some might argue you have a lot of percentage of oil and gas, but, you know, I think you can make an argument that, yes, but the transition of your customer base is you're gonna be an enabler of that. So can you maybe- Absolutely. T alk about where you fit into the goals of your customers and what they're gonna look like, you know, down the road? Yeah. So our, our products typically are in large installations, so refineries are our single biggest market, right? When you think about a refinery, it's just, it's essentially a chemical plant. And what operators are doing, whether it's you know, a pure refining company or an integrated oil company or a national oil company, they all have targets, and some of it is regulation-driven, some of it's government-driven, but others, it's just their own ESG targets, and they're trying to do the right thing to drive emissions down, to make that refinery or that asset, you know, more efficient. And we're involved in all of that. And so when we, y ou know, we've had amazing work, you know, in what we consider the decarbonization lane, supporting those existing customers, really helping them through this journey. I can go through, we'll go through examples here, but a lot of them are doing biodiesel conversions or, you know, doing some sort of blended formulaic approach on the front end that's still delivering a, you know, some sort of fuel that works. And, you know, whether it's sustainable aviation fuel or a biodiesel plant or, you know, something blended into a normal gasoline. But when they do that, they're replumbing their system with, you know, different pumps and valves, and so we're involved in that. A lot of times on the front end now, we're seeing, certainly on the chemical plants, we're seeing recyclable plastics, and so we're involved with technology to help the recycling aspects of plastics on the front end. We've got a program called Energy Advantage, which is a consultative program where we go in and we assess a flow loop, and we look at the pumps and the valves, and we say, "Hey, you know, this flow loop can be run more efficiently, and by running it more efficiently, your energy consumption drops down, your CO2 emissions gets better." and then on the back end is the carbon capture. And so we've got opportunities through some of our pump technology and valve technology to, you know, pull, you know, from their flare or flue gas. We can recover that carbon, and then we're involved in, you know, the sequestration of that, whether they're putting it in underground storage, or are they putting it back into their, their process. So, you know, we're doing a ton of work with our existing customers that we've been with for a long, long time. We have massive installed base in these, you know, existing infrastructure, and we're helping them with their initiatives through ESG or complying with regulatory environment. Look, we feel like we're in the middle of this, where, you know, every day we've got wins for our customers, and we're pretty excited about what we're doing here. So I think everyone now is trying to figure out, how am I levered to data centers and AI and things like this? Now, power is a big piece of that, and I think that's emerging as potentially a bottleneck and people trying to figure out, we can build these things, but how do we turn them on? And, can you maybe explain where you are in terms of, power gen build-out and where, you know, how, how agnostic are you to generation technique, things like that? Sure. Yeah, so, I mean, we have a, a big power business. It's roughly $450 million of revenue every year for us, and we're very much in power generation, like, that's where we play. And so whether it's a nuclear power plant, coal-fired power plant, natural gas, or some of the renewables, there's a flow control element to all of those assets. And so we've got a, a big business, a huge installed base. We're very active on some of the new things. And then I'll just say a couple data points. You know, over the last kinda 2 decades, maybe even 3 decades, U.S. power consumption has only gone down, right? That's on the back of efficiency with appliances and buildings and things like that, and it's the exact same trend in Europe. But with the, you know, the recent, the last kinda 5 years, electrification of vehicles, electrification of essentially everything, now combine that with this, you know, this desire and thirst for AI and data and, you know, more data centers that are just, like, pulling on the grid in a substantial level. We believe that, that there's gonna be substantial capacity build-out for power generation. And so again, we're, you know, we're in the middle of that with pumps and valves. We've got $450 million today of growth. A lot of that's aftermarket, but we're involved in, in all forms of new power generation. So if they're, you know, extending the life of a nuclear asset, or they're building greenfield nuclear, that's a really good business for us. We get spec'd in with our technology. If you went natural gas power plant or combined cycle, we're in the middle of that. I don't think they're building new coal, certainly in Europe or the U.S., but they're extending the life of coal plants, and as they do that, we're refurbishing pumps and valves and that. And then on the renewables side, you know, while we don't do a ton in the wind side, there we do put valves in the generation side of wind. We are involved in solar, mostly on concentrated solar power. We'll do the molten salt applications, 'cause there's a flow control aspect to that, and then we're very involved in hydrogen as well. And so, you know, we put out I think we put 3.2% growth for power last year as a kind of a forward CAGR, and I would say we've understated that substantially. We'll come out with kind of what we think a new CAGR is for our business around the power segment, but we feel really optimistic about long-term growth and power right now. And then maybe I'll combine these two. You know, the government's obviously putting out a lot of money towards dedicated infrastructure funds. What are you seeing from that? Where would you see that? Is it gonna be more on, like, the water side? Like, how's your visibility right now in terms of the funnel? Yeah, so the infrastructure bill for us is predominantly water. So we'll see that in flood control, we'll see it in municipal, kind of like a revamping of their municipal water markets. And then sometimes we'll pick up industrial applications as well that will be... you know, like, I think, like some of the chip manufacturing that's coming back to the U.S., we'll do industrial water on the back of that, and then our vacuum technology is applied to some of the manufacturing there. And so I'd just say, as we reshore and regionalize, and this is happening in Europe, certainly happening in the U.S., and then with government money behind it, we're seeing our general industries and our water start to tick up nicely. But I'd say the biggest spending on the infrastructure bill is coming through water. Yeah. And the project funnel, like, your orders have been very stable in this, like, you know, $4 billion a year, roughly $1 billion a quarter. Is that a level we should think should hold for a while here? Yeah, absolutely. We don't, we don't see it going backwards at all. We think we grow off this. Our project funnel's up 10% year-on-year, driven largely out of the Middle East, but we're seeing project activity around the world. Decarbonization is probably the single biggest lever there, but we're seeing significant, you know, significant outlook on all projects. So power's up 25% in the forward funnel, decarbonization's up 25%. So we feel good about that. And then that base business of the aftermarket MRO, which is existing assets, chemical plants, water facilities, refineries, we don't see that utilization rate coming down. And so our core business with aftermarket support and services, we feel really confident that that stays at the level that it's at. We feel good about the outlook, Joe. Okay, maybe last question here. I mean, you're the biggest player in your markets generally, and so it's easy. I think a lot of competitors say that they take market share from Flowserve, and usually that's the way it goes from the larger player. But, you know, how do you feel like you've done on market share? And, you know, in things that you're actually trying to win, or how much of maybe some bleed in certain areas might be things that you're intentionally allowing to bleed off? Like, how. Maybe talk us through that dynamic. Sure. We have a really broad portfolio, so it's hard to answer. Yeah. I would say we feel really good market share gains in our seal business, our aftermarket business, really that entitlement to serve our aftermarket; we know we're making gains there. That number continues to move up every year. We've been very selective in our large project pump business, and so I'd say we may have given some market share away there, but we've done that very deliberately, making sure that the margins and the aftermarket entitlement is there, and we're working with customers that we know we can execute well with. And so there's a chance that that market share has gone down, but again, you know, we're growing that business, we're growing it deliberately and responsibly, and I, I feel really good about the position we're in. On the valve side, I'd say overall, you know, we're growing that well. We had great bookings in Q1. I'd say there might be small pockets where we have lost a little bit of market share, but I'd say in some of the, the really the products that we like a lot, we know we've gained market share. And so I'd say, you know, net-net, we feel good about the, where we're at. We like the growth trajectory that we're on. We committed to kind of a 5% growth rate going forward, and I'm, I'm very confident that we can meet or exceed that target, and so I'm not overly concerned about market share losses at all. All right, I think we need to leave it there. We're a minute over, so I apologize to everyone, and to you, Scott, for my own technical difficulties. But I think we got through most of it. Yeah. Thank you everyone for joining, and if you have any follow-ups, reach out to me, and we can get that taken care of. Thank you all, and we'll see you soon. Yep. Thanks for having me, Joe. Appreciate it.