The new capital structure strategy includes returning additional capital more quickly to shareholders through a new US$1 billion stock repurchase program approved by the board.
Flowserve chief financial officer Mike Taff said: “This new capital structure strategy involves prudently increasing our leverage to drive cash utilisation efficiency and return increased capital to shareholders, while still maintaining a strong balance sheet to fund future growth. We believe this new capital structure strategy will provide us ample flexibility to allocate cash in ways that drive attractive returns for our shareholders, which include stock repurchases, dividends, disciplined capital investments and value-creating, bolt-on acquisitions that represent a compelling strategic fit.”
“Over the last three years, we have demonstrated our ability to generate substantial free cash flow during a historically difficult period of our business cycle. With our global energy infrastructure markets showing signs of increased demand and vitality, and as we continue to see significant benefits from implementing our One Flowserve strategy, we are now in a position to further refine our capital structure strategy,” added Flowserve president and CEO Mark Blinn.