SPX FLOW, Inc. (NYSE:FLOW) Q3 2019 Earnings Conference Call - Final Transcript
Oct 30, 2019 • 08:30 am ET
Ladies and gentlemen, thank you for standing by, and welcome to the SPX FLOW Third Quarter 2019 Earnings Call. At this time, all participants lines are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator instructions]
I would now like to hand the conference over to your speaker today, Ryan Taylor, Chief Strategy Officer. Please go ahead, sir.
Thank you, Sarah, and good morning, everyone. Thanks for joining us on the call today. With me here are Marc Michael, our President and CEO; and Jaime Easley, our Chief Financial Officer. Our Q3 2019 earnings release was issued earlier this morning and can be found on our website spxflow.com. This call is also being webcast. The presentation for the webcast is located in the Investors section of our website and includes details of our Q3 results. A replay of the webcast will be available on our site later today.
Note that elements of this presentation contain forward-looking statements that are based on our current view of our businesses and their markets. Those elements are subject to change, and we ask that you view them in that light. Principal risk factors that may impact our performance are identified in our most recent SEC filings. And in the appendix of today's presentation, we've also provided reconciliations for all non-GAAP and adjusted measures presented.
And with that, I'll turn the call over to Marc.
Thanks, Ryan. Good morning, everyone, and thanks for joining us on the call. Our third quarter results underscore the progress we've made on our strategic transformation to a premier process solutions enterprise. Additionally, our operational performance in the period demonstrates the ability of our team to execute on many levels in a volatile economic environment. Our financial results exceeded guidance. We delivered strong margin expansion and cash generation, further strengthened our balance sheet and made significant progress with respect to our strategic initiatives. I want to thank our teams across the enterprise for their hard work, tireless effort and positive contributions to the quarter.
We are excited about the future and committed to delivering a differentiated customer experience, creating an engaging winning culture for employees and investing in our business to strengthen our core capabilities and drive long-term growth and attractive micro verticals.
I'll begin with an overview of our third quarter results. In Q3 we delivered $384 million of revenue, exceeding the high end of our guidance range on better-than-expected project execution in our process systems business and a higher level of shipments across our factories. We achieved gross margins of 35%, up 270 points year-over-year and up 120 points on a sequential basis. Segment income was $56 million and segment margins improved to 14.6%, up 60 points year-over-year and 300 points sequentially.
As compared to our midpoint guidance, segment income was $6 million above expectations driven by crisp operating performance across the business. Adjusted EPS was $0.59 and exceeded our midpoint guidance by $0.12, driven by segment income and margins. The margin performance