The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and notes included in Part I, Item I "Financial Statements" of this quarterly report and the audited financial statements and related footnotes included in our Prospectus that forms a part of our Registration Statement on Form S-1, as amended (Registration No. 333-148486), which Prospectus was filed pursuant to Rule 424(b)(4) on May 8, 2008.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the SEC. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including statements regarding: projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of management for future operations including statements relating to potential acquisitions, compensation plans, purchase commitments; developments, performance or industry or market rankings relating to products or services; future economic conditions or performance; the outcome of outstanding claims or legal proceedings including asbestos-related and insurance liabilities; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statements that address activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be characterized by terminology such as "believe," "anticipate," "should," "would," "intend," "plan," "will," "expects," "estimates," "projects," "positioned," "strategy," and similar expressions. These statements are based on assumptions and assessments made by our management in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including but not limited to the following:

• risks associated with our international operations;

• significant movements in foreign currency exchange rates;

• availability and cost of raw materials, parts and components used in our products;

• the competitive environment in our industry;

• our ability to identify and successfully integrate attractive acquisition targets;

• the amount of and our ability to estimate our asbestos-related liabilities;

• material disruption at any of our significant manufacturing facilities;

• the solvency of our insurers and the likelihood of payment for asbestos-related claims;

• our ability to manage and grow our business and execution of our business and growth strategies;

• loss of key management;

• our ability to access required capital at a reasonable cost;

• our ability to expand our business in our targeted markets;

• our ability to cross-sell our product portfolio to existing customers;

• the level of capital investment and expenditures by our customers in our strategic markets;

• our financial performance; and

• others risks and factors, listed under the "Risk Factors" section of this Form 10-Q as well as our Prospectus that forms a part of our Registration Statement on Form S-1, as amended (Registration No. 333-148486), which Prospectus was filed pursuant to Rule 424(b)(4) on May 8, 2008.

Any such forward-looking statements are not guarantees of future performance and actual results, developments and business decisions may differ materially from those envisaged by such forward-looking statements. These forward-looking statements speak only as of the date this Form 10-Q is filed with the SEC. We do not assume any obligation and do not intend to update any forward-looking statement except as required by law. See the "Risk Factors" section of this Form 10-Q as well as our Prospectus that forms a part of our Registration Statement on Form S-1, as amended (Registration No. 333-148486), which Prospectus was filed pursuant to Rule 424(b)(4) on May 8, 2008 for a further discussion regarding some of the reasons that actual results may be materially different from those that we anticipate.

Overview

We are a global supplier of a broad range of fluid handling products, including pumps, fluid handling systems and specialty valves. We believe that we are a leading manufacturer of rotary positive displacement pumps, which include screw pumps, gear pumps and progressive cavity pumps. We have a global manufacturing footprint, with production facilities in Europe, North America and Asia, as well as worldwide sales and distribution channels. Our products serve a variety of applications in five strategic markets: commercial marine, oil and gas, power generation, global navy and general industrial. We design and engineer our products to high quality and reliability standards for use in critical fluid handling applications where performance is paramount. We also offer customized fluid handling solutions to meet individual customer needs based on our in-depth technical knowledge of the applications in which our products are used. Our products are marketed principally under the Allweiler, Fairmount, Houttuin, Imo, LSC, Portland Valve, Tushaco, Warren and Zenith brand names. We believe that our brands are widely known and have a premium position in our industry. Allweiler, Houttuin, Imo and Warren are among the oldest and most recognized brands in the markets in which we participate, with Allweiler dating back to 1860.

We believe that one of our most significant competitive advantages comes through a comprehensive set of tools and processes we employ that we refer to as the Colfax Business System ("CBS"). CBS is a disciplined strategic planning and execution methodology designed to achieve excellence and world-class financial performance in all aspects of our business by focusing on the Voice of the Customer and continuously improving quality, delivery and cost.

Outlook

We believe that we are well positioned to continue to grow organically by enhancing our product offerings and expanding our customer base in our strategic markets. The recent economic uncertainty has not had a significant impact on our financial position, results of operations or liquidity as of the date of the filing of this Form 10-Q. We continue to monitor the financial markets and general global economic conditions and presently expect favorable market conditions to continue throughout 2008 and into 2009 as follows:

• In the commercial marine industry, we expect growth in international trade and demand for crude oil and other commodities to create demand for new ship construction. We also believe the increase in the size of the global fleet will create an opportunity to supply aftermarket parts and service.

• We expect activity within the crude oil market to remain favorable as capacity constraints and global demand drive further development of heavy oil fields. We expect demand for our highly efficient products to remain strong as our customers continue to focus on total cost of ownership.

• In the power generation industry, we expect activity in Asia and the Middle East to remain strong as economic growth and fundamental under supply of power generation capacity continues to drive investment in energy infrastructure projects. In the world's developed economies, we expect efficiency improvements will continue to drive demand.

• In the general industrial market, we expect that global infrastructure development will continue to drive capital investment and will benefit local suppliers as well as international exporters of fluid handling equipment.

Our global manufacturing sales and distribution network allows us to target fast growing regions throughout the world. We have production and distribution facilities in both India and China. We intend to leverage these investments to substantially grow our market share in these emerging markets and plan to continue to invest in sales and marketing resources to increase our overall coverage.

We will also continue to target aftermarket opportunities in our strategic markets as we generally are able to generate higher margins on aftermarket parts and service than on foremarket opportunities. For the three and nine months ended September 26, 2008, aftermarket sales and services represented approximately 24% of our revenues.

We also expect to continue to grow as a result of strategic acquisitions. We believe that the extensive experience of our management team in acquiring and effectively integrating acquisition targets should enable us to capitalize on opportunities in the future.

Key Performance Measures

The discussion of our results of operations that follows focuses on some of the key financial measures that we use to evaluate our business. We evaluate growth using several measures described below, including net sales, orders and order backlog. Our sales growth is affected by many factors, particularly growth in our existing businesses, the impact of acquisitions and the impact of fluctuating foreign exchange rates. To facilitate the comparison between reporting periods, we describe the impact of each of these three factors on our sales growth below in tabular format under the heading "Sales and Orders."

Orders and order backlog are highly indicative of our future revenue and thus a key measure of anticipated performance. Orders consist of orders for products or services from our customers. Order backlog consists of unfilled orders.

Seasonality

We experience seasonality in our fluid handling business. As our customers seek to fully utilize capital spending budgets before the end of the year, our shipments generally peak during the fourth quarter. Also, our European operations typically have lower sales during the July and August holiday season.

Results of Operations

Items Affecting Comparability of Reported Results

The comparability of our operating results for the three and nine months ended September 26, 2008 and September 28, 2007 is affected by the following significant items:

Acquisitions

Acquisitions significantly affect our reported results and can make period to period comparisons of results difficult. As a result, we disclose our sales growth between periods both from existing and acquired businesses.

On January 31, 2007, we completed the acquisition of Lubrication Systems Company of Texas ("LSC"), a manufacturer of fluid handling systems, including oil mist lubrication and oil purification systems. LSC strengthens our presence in the oil and gas end-market, particularly in the downstream refinery segment, broadens our overall lubrication portfolio, and presents the opportunity to expand its product application to other markets.

On November 29, 2007, we acquired Fairmount Automation, Inc. ("Fairmount"), an original equipment manufacturer of mission critical programmable automation controllers in fluid handling applications primarily for the U.S. Navy. In addition to strengthening our existing position with the U.S. Navy, we intend to leverage Fairmount's experienced engineering talent and technology expertise to develop a portfolio of fluid handling solutions with diagnostic and prognostic capabilities for industrial applications.

Selling, general and administrative costs for the three months ended September 26, 2008 include $0.6 million in due diligence costs related to a potential acquisition that did not result in a purchase agreement.

Foreign Currency Fluctuations

A significant portion of our sales, approximately 65.8% and 67.0%, respectively, for the three and nine months ended September 26, 2008, is denominated in currencies other than the U.S. dollar, most notably the Euro and the Swedish Krona. Because much of our manufacturing and employee costs are outside the U.S., a significant portion of our costs are also denominated in currencies other than the U.S. dollar. Changes in foreign exchange rates can impact our results and is quantified, when significant, in our discussion of the results of our operations.

IPO-related Costs

Results for the nine months ended September 26, 2008 include $57.0 million of nonrecurring costs associated with our IPO during the second quarter. This amount includes $10.0 million of share based compensation and $27.8 million of special cash bonuses paid under previously adopted executive compensation plans as well as $2.8 million of employer payroll taxes and other related costs. It also includes $11.8 million to reimburse the selling stockholders for the underwriting discount on the shares sold by them as well as the write-off of $4.6 million of deferred loan costs associated with the early termination of a credit facility.

Legacy Legal Adjustment

Selling, general and administrative expenses for the nine months ended September 26, 2008 include a $4.1 million increase to legal reserves in the second quarter related to non-asbestos litigation which arose from the sale and subsequent repair of a product by a division of a subsidiary that was divested prior to our acquisition of the subsidiary. This legacy legal case was settled during the third quarter of 2008. See Part II, Item 1 - Legal Proceedings for a further discussion of this legacy legal matter.

Asbestos-related (Income) Expense

Asbestos-related (income) expense includes all asbestos-related costs and is comprised of projected indemnity cost, changes in the projected asbestos liability, changes in the probable insurance recovery of the projected asbestos-related liability, changes in the probable recovery of asbestos liability and defense costs paid in prior periods, and actual defense costs expensed in the period ("Asbestos liability and defense costs (income)"). It also includes legal costs related to the actions against two of our subsidiaries' respective insurers and a former parent company of one of the subsidiaries ("Asbestos coverage litigation expenses").

The table below presents asbestos-related (income) expense for the periods indicated:

                                            Three Months Ended                              Nine Months Ended
                                   September 26,           September 28,          September 26,           September 28,
(Amounts in millions)                  2008                    2007                   2008                    2007
Asbestos liability and
defense (income) costs            $          (6.3 )       $         (30.3 )      $          (6.7 )       $         (32.0 )
Asbestos coverage litigation
expenses                                      5.1                     2.4                   12.3                     8.3

Asbestos-related (income)
expense                           $          (1.2 )       $         (27.9 )      $           5.6         $         (23.7 )

Asbestos liability and defense (income) costs was $(6.3) million and $(6.7) million for the three and nine months ended September 26, 2008 compared to $(30.3) million and $(32.0) million for the three and nine months ended September 28, 2007, respectively.

Legal costs related to the subsidiaries' action against their asbestos insurers were $5.1 million and $12.3 million for the three and nine months ended September 26, 2008 compared to $2.4 million and $8.3 million for the three and nine months ended September 28, 2007, respectively. See Note 11 to our Condensed Consolidated Financial Statements for a further discussion of recent developments in asbestos litigation.

The decrease in asbestos liability and defense (income) cost for the quarter ended September 26, 2008 relates primarily to $31.9 million of income recognized in the quarter ended September 28, 2007 from revaluing our insurance asset from an expected recovery percentage of 75% to 87.5%. The revaluation of the insurance asset results from a series of favorable court rulings, while the value ascribed to the insurance policies is attributable to an agreement in principle with an insurer.

The increase in legal cost for both the quarter and the nine months ended September 26, 2008 relates primarily to preparation for trial by one of our subsidiaries against a number of its insurers and former parent. The trial is expected to commence in the fourth quarter of 2008.

Sales and Orders

Our sales growth is affected by many factors including acquisitions, fluctuating foreign exchange rates, and growth in our existing businesses. To facilitate the comparison between reporting periods, we disclose the impact of each of these three factors. Growth due to acquisitions includes incremental sales due to an acquisition during the period or incremental sales due to reporting a full year's sales for an acquisition that occurred in the prior year. The impact of foreign currency translation is the difference between sales from existing businesses valued at current year foreign exchange rates and the same sales valued at prior year foreign exchange rates. Sales growth from existing businesses excludes both the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of growth due to factors such as price, mix and volume.

Orders and order backlog are highly indicative of our future revenue and thus key measures of anticipated performance. Orders consist of orders for products or services from our customers. Order backlog consists of unfilled orders. The components of order growth are presented on the same basis as sales growth.

The following tables present components of our sales and order growth, as well as sales by fluid handling product for the periods indicated:

                                                    Sales              Orders
(Amounts in millions)                              $       %          $       %
Three Months Ended September 28, 2007           $ 125.4            $ 153.6
Components of Growth:
Existing Businesses                                17.9   14.3 %       8.7    5.7 %
Acquisitions                                        1.2    1.0 %       2.2    1.4 %
Foreign Currency Translation                        9.0    7.1 %       9.3    6.0 %

Total Growth                                       28.1   22.4 %      20.2   13.2 %

Three Months Ended September 26, 2008           $ 153.5            $ 173.8


                                                                                       Backlog at
                                                    Sales              Orders          Period End
(Amounts in millions)                              $       %          $       %            $          %
Nine Months Ended September 28, 2007            $ 362.6            $ 425.0            $      263.0
Components of Growth:
Existing Businesses                                42.7   11.8 %      66.8   15.7 %          102.1   38.8 %
Acquisitions                                        4.7    1.3 %       8.6    2.0 %           13.3    5.1 %
Foreign Currency Translation                       35.5    9.8 %      42.5   10.0 %            4.7    1.8 %

Total Growth                                       82.9   22.9 %     117.9   27.7 %          120.1   45.7 %

Nine Months Ended September 26, 2008            $ 445.5            $ 542.9            $      383.1

                                              Three Months Ended                       Nine Months Ended
                                      September 26,       September 28,        September 26,       September 28,
(Amounts in millions)                     2008                 2007                2008                2007
Net Sales by Product:
Pumps, including aftermarket
parts and service                    $         138.0     $          110.7     $         393.1     $         320.3
Systems, including installation
service                                         11.0                 11.1                38.9                29.9
Valves                                           4.0                  3.4                11.8                12.1
Other                                            0.5                  0.2                 1.7                 0.3

Total net sales                      $         153.5     $          125.4     $         445.5     $         362.6

As detailed above, sales growth from existing business increased 14.3% and 11.8% for the three and nine months periods ended September 26, 2008, respectively, over the comparable period in the prior year. In both periods, these increases were primarily attributable to increased volume and demand in the commercial marine, general industrial and power generation end markets. Acquisition growth of 1.0% for the quarter was due to the acquisition of Fairmount on November 29, 2007. Year to date acquisition growth of 1.3% was due to the acquisition of LSC on January 31, 2007 and Fairmount on November 29, 2007. Foreign currency translation increased sales and orders for both the three and nine month periods ending September 26, 2008. These increases were primarily due to the weakening of the U.S. dollar against the Euro. Subsequent to quarter end, the U.S. dollar appreciated sharply against both the Euro and the Swedish Krona, which is expected to have a negative effect on our sales and order growth resulting from currency translation in the fourth quarter of 2008.

Order growth from existing businesses was strong in all of our strategic end markets, up 15.7% on a year to date basis. Most notably, oil and gas orders and commercial marine orders increased by 23.1% and 22.1%, respectively. For the quarter, order growth from existing businesses was 5.7%. Most notably, oil and gas orders were up 36.5%, and global navy orders grew 12.0%. Commercial marine orders decreased by 3.7% primarily due to higher growth in the first two quarters of the year and cancellations attributed to liquidity constraints at smaller shipyards of approximately $1.1 million. Our backlog of orders at September 26, 2008 remains strong at $383.1 million compared to $384.0 million at June 27, 2008. On a currency adjusted basis, backlog increased $19.0 million or 5.0% from June 27, 2008.

Gross Profit

The following table presents our gross profit and gross profit margin figures
for the periods indicated:



                                               Three Months Ended                              Nine Months Ended
                                    September 26,             September 28,           September 26,          September 28,
(Amounts in millions)                    2008                     2007                    2008                   2007
Gross Profit                       $           54.5         $            44.5        $         159.4        $         126.4
Gross Profit Margin                            35.5 %                    35.5 %                 35.8 %                 34.9 %

Gross profit for the three months ended September 26, 2008 increased $10.0 million, or 22.4%, from the comparable period in the prior year. Of the $10.0 million increase, $6.3 million was attributable to growth from existing businesses, $0.7 million was due to the acquisitions of Fairmount on November 29, 2007, and $3.0 million was due to the impact of foreign exchange rates.

Gross profit for the nine months ended September 26, 2008 increased $33.1 million, or 26.2%, from the comparable period in the prior year. Of the $33.0 million increase, $18.8 million was attributable to growth from existing businesses, $2.0 million was due to the acquisition of LSC on January 31, 2007 and Fairmount on November 29, 2007, and $12.2 million was due to the impact of foreign exchange rates.

For the quarter, gross profit margins were flat when compared with the prior year but increased 90 basis points for the year to date period. For the quarter, margin improvement in our European operations was offset by a heavier mix of higher margin pipeline projects in the third quarter of 2007. The margin improvement for the year to date period was primarily driven by the Company's European operations and reflects favorable pricing and cost control in the commercial marine market as well as increased aftermarket sales.

Selling, General and Administrative Expenses ("SG&A")

The following table presents our selling, general and administrative expenses for the periods indicated:

                                                            Three Months Ended                                      Nine Months Ended
                                                September 26,                September 28,              September 26,               September 28,
(Amounts in millions)                                2008                        2007                        2008                       2007
SG&A Expenses                                  $           33.2            $            26.8           $           97.5            $          75.3
SG&A Expenses as a percentage of sales                     21.7 %                       21.3 %                     21.9 %                     20.8 %

Selling, general and administrative expenses increased $6.5 million to $33.2 million for the three months ended September 26, 2008 compared to $26.8 million for the three months ended September 28, 2007. Of the $6.5 million increase, $1.8 million was due to the impact of foreign exchange rates, $1.3 million relates to higher professional and other costs associated with becoming a public company, and $0.9 million relates to unrealized losses on raw material futures . . .