FLOWSERVE CORPORATION CONSOLIDATED STATEMENTS OF INCOME Year Ended December 31, 2018 2017 2016 (Amounts in thousands, except per share data) Sales $ 3,832,666 $ 3,660,831 $ 3,990,487 Cost of sales (2,644,830) (2,571,878) (2,753,689) Gross profit 1,187,836 1,088,953 1,236,798 Selling, general and administrative expense (943,714) (901,727) (965,376) (Loss) gain on sale of businesses (7,727 ) 141,317 (7,664 ) Net earnings from affiliates 11,143 12,592 12,926 Operating income 247,538 341,135 276,684 Interest expense (58,160) (59,730) (60,137) Interest income 6,465 3,429 2,804 Other expense, net (19,569) (21,827) (6,439) Earnings before income taxes 176,274 263,007 212,912 Provision for income taxes (51,224) (258,679) (77,380) Net earnings, including noncontrolling interests 125,050 4,328 135,532 Less: Net earnings attributable to noncontrolling interests (5,379) (1,676) (3,077) Net earnings attributable to Flowserve Corporation $ 119,671 $ 2,652 $ 132,455 Net earnings per share attributable to Flowserve Corporation common shareholders: Basic $ 0.91 $ 0.02 $ 1.02 Diluted 0.91 0.02 1.01 See accompanying notes to consolidated financial statements. 57