-
Reports third quarter sales of $663 million, down 23 percent
year-over-year.
-
Delivers $103 million of free cash flow; Year to date free cash flow
at $202 million
-
Operating margins in Water Group increase year over year; Technical
Products adjusted operating margins over 14 percent
-
Introduces fourth quarter adjusted EPS guidance of $0.40 to $0.44 and
updates full year adjusted EPS guidance of $1.40 to $1.44.
All financial information and period-to-period references are on a
continuing operations basis unless otherwise noted. Reconciliations
to discontinued operations as well as GAAP and Non-GAAP reconciliations
are in the attached financial tables.
MINNEAPOLIS--(BUSINESS WIRE)--Oct. 20, 2009--
Pentair, Inc. (NYSE:PNR) today announced third quarter 2009 net earnings
per diluted share from continuing operations (EPS) of $0.38. This
represents a decrease of 12 percent as compared to the $0.43 of EPS in
the third quarter last year. Current period results included a negative
$0.04 per share impact from restructuring charges. Adjusting for these
items, third quarter 2009 EPS was $0.42, compared to adjusted third
quarter 2008 EPS of $0.56, a decrease of 25 percent.
Total company sales decreased 23 percent to $663 million, compared with
$856 million in the third quarter of 2008. The company delivered third
quarter operating income of $67 million. On an adjusted basis, the
company delivered operating income of $74 million versus $101 million in
the year-ago quarter. The company’s adjusted operating income in the
current quarter excluded the impact of additional severance charges
associated with the third quarter elimination of 275 positions not
included in prior restructuring. Overall, adjusted operating margins for
the third quarter contracted 60 basis points to 11.2 percent. The
positive impact from productivity and price did not offset the
significant negative impact related to lower volumes.
Total company free cash flow was positive $103 million for the quarter.
Year-to-date the company has generated $202 million of free cash flow,
which is $95 million more than was generated in the first three quarters
of 2008. The company said it remains on track to achieve free cash flow
greater than $225 million for 2009.
“We continue to benefit from our cost actions and remain committed to
our full year outlook. Additionally, with our strong free cash flow
generation and the investments we have maintained in product innovation
and sales and marketing we believe the company remains in an excellent
position to benefit as markets recover,” said Randall J. Hogan, Pentair
chairman and chief executive officer.
THIRD QUARTER BUSINESS HIGHLIGHTS
The Water Group delivered $462 million in sales, a 17 percent
decline year-over-year. Sales were down 16 percent excluding foreign
exchange.
-
Flow Technologies sales were down 14 percent versus the year-ago
quarter, as growth in the company’s global municipal market did not
offset declines in commercial, industrial and residential markets.
-
Filtration sales were down 21 percent as sales to global residential,
commercial and industrial markets continue to reflect inventory
destocking and overall market softness.
-
Global Pool sales were down 16 percent as the prolonged decline in
North American residential pool markets persists.
The Water Group’s third quarter reported operating income totaled $53
million, up 7 percent as compared to $50 million in the same period last
year. In the quarter, the Water Group had $3 million in pre-tax
restructuring charges associated with severance from recently announced
additional headcount reductions. Excluding these items, third quarter
2009 adjusted operating income was $56 million, down 12 percent versus
third quarter 2008 adjusted operating income of $63 million. Adjusted
operating margins of 12.1 percent were up 80 basis points as benefits
from productivity more than offset the negative impact from volume
declines, inflation, and pay-as-you-go restructuring costs.
Technical Products delivered third quarter 2009 sales of $201
million, a decrease of 32 percent versus the year-earlier period. Sales
were down 31 percent excluding the impact of foreign exchange.
-
Global Electrical sales were down 29 percent as industrial customers
continue to reduce capital projects and distributors aggressively
reduced inventory levels.
-
Global Electronic sales were down 34 percent as each of our major
vertical markets contracted.
Technical Products’ third quarter reported operating income totaled $24
million, down 49 percent compared to $48 million in the same quarter
last year. Adjusting for a restructuring charge, operating income was
$29 million. Adjusted operating margins were 14.4 percent, down 180
basis points versus the third quarter 2008. In the quarter, the benefits
from productivity did not offset the negative impact from volume
declines and foreign exchange.
“Overall, our third quarter results were solid given the recessionary
environment. The results of our productivity actions were reflected in
our Water business adjusted margins which expanded 80 basis points year
over year despite a 17 percent sales decline,” said Randall J. Hogan,
Pentair chairman and chief executive officer. “Additionally, our
Technical Products business produced adjusted margins of over 14 percent
despite sales declines of 32 percent, which were worse than anticipated
and reflected declines in most major end markets.”
OUTLOOK
The company introduces its fourth quarter reported 2009 EPS guidance
range of $0.37 to $0.41 which would be up when compared to fourth
quarter 2008 reported EPS of $0.22. Adjusting for non-recurring items in
both years (see attached reconciliation table) fourth quarter adjusted
EPS is expected to be $0.40 to $0.44 or essentially flat with the year
ago quarter. Fourth quarter sales are expected to be down approximately
14 percent.
The company updates its full year reported 2009 EPS guidance to $1.25 to
$1.29, which would be down approximately 50 percent when compared to
reported full year 2008 EPS. Adjusting for non-recurring items in both
years full year adjusted 2009 EPS is expected to be $1.40 to $1.44 or
down approximately 35 percent year over year. The company continues to
anticipate future non-recurring gains from certain tax items but the
timing is uncertain so these items are not included in the current full
year reported EPS guidance.
“As anticipated, the benefits of our cost actions are rapidly improving
our operating margins and earnings,” said Hogan. “Our fourth quarter EPS
guidance demonstrates the results of our structural cost savings as we
expect earnings to be flat year over year with higher operating margins
despite anticipated sales declines.”
“We continue to position the company for market recovery, which we are
seeing in some select markets and regions, and expect our operating
margins and earnings growth will demonstrate that much of what we’ve
accomplished in 2009 is sustainable,” Hogan added.
EARNINGS CONFERENCE CALL
Pentair Chairman and CEO Randall J. Hogan and Chief Financial Officer
John L. Stauch will discuss the company’s performance and fourth quarter
and full year 2009 guidance on a two-way conference call with investors
and a live audio webcast at 9 a.m. Eastern today. Reconciliation of
non-GAAP financial measures are set forth in the attachments to this
third quarter 2009 earnings release and in the third quarter 2009
earning release conference call presentation, both of which can be found
at Pentair’s web site (www.pentair.com).
Related financial charts and certain other information to be discussed
on the conference call will be available on the company’s website
shortly before the conference call. The web cast and presentation will
be archived at the same site following the conclusion of the conference
call.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
Any statements made about the company’s anticipated financial results
are forward-looking statements subject to risks and uncertainties such
as the breadth and severity of the global economic downturn; the
strength of housing and related markets; the ability to implement our
restructuring and other cost reduction plans successfully and the risk
that expected benefits may not be fully realized or may take longer to
realize than expected; foreign currency effects; retail, commercial and
industrial demand; product introductions; and pricing and other
competitive pressures, as well as other risk factors set forth in our
SEC filings. Forward-looking statements included herein are made as of
the date hereof, and the company undertakes no obligation to update
publicly such statements to reflect subsequent events or circumstances.
Actual results could differ materially from anticipated results.
ABOUT PENTAIR, INC.
Pentair (www.pentair.com)
is a diversified operating company headquartered in Minnesota. Its Water
Group is a global leader in providing innovative products and systems
used worldwide in the movement, treatment, storage and enjoyment of
water. Pentair’s Technical Products Group is a leader in the global
enclosures and thermal management markets, designing and manufacturing
thermal management products and standard, modified, and custom
enclosures that house and protect sensitive electronics and electrical
components. With 2008 revenues of $3.35 billion, Pentair employs
approximately 13,100 people worldwide.
Pentair, Inc. and Subsidiaries
Condensed Consolidated
Statements of Income (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Nine months ended
|
|
In thousands, except per-share data
|
|
September 26
2009
|
|
|
September 27
2008
|
|
|
September 26
2009
|
|
|
September 27
2008
|
|
Net sales
|
|
$
|
662,665
|
|
|
$
|
855,815
|
|
|
$
|
1,990,217
|
|
|
$
|
2,584,339
|
|
Cost of goods sold
|
|
|
455,698
|
|
|
|
599,862
|
|
|
|
1,417,539
|
|
|
|
1,799,282
|
|
Gross profit
|
|
|
206,967
|
|
|
|
255,953
|
|
|
|
572,678
|
|
|
|
785,057
|
|
% of net sales
|
|
|
31.2%
|
|
|
|
29.9%
|
|
|
|
28.8%
|
|
|
|
30.4%
|
|
Selling, general and administrative
|
|
|
125,578
|
|
|
|
154,118
|
|
|
|
361,957
|
|
|
|
437,831
|
|
% of net sales
|
|
|
18.9%
|
|
|
|
18.0%
|
|
|
|
18.2%
|
|
|
|
16.9%
|
|
Research and development
|
|
|
14,707
|
|
|
|
16,221
|
|
|
|
43,265
|
|
|
|
47,303
|
|
% of net sales
|
|
|
2.2%
|
|
|
|
1.9%
|
|
|
|
2.2%
|
|
|
|
1.8%
|
|
Legal settlement
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
20,435
|
|
Operating income
|
|
|
66,682
|
|
|
|
85,614
|
|
|
|
167,456
|
|
|
|
279,488
|
|
% of net sales
|
|
|
10.1%
|
|
|
|
10.0%
|
|
|
|
8.4%
|
|
|
|
10.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income) expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of interest in subsidiaries
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(109,648)
|
|
Equity losses of unconsolidated subsidiary
|
|
|
135
|
|
|
|
669
|
|
|
|
691
|
|
|
|
2,433
|
|
Loss on early extinguishment of debt
|
|
|
—
|
|
|
|
4,611
|
|
|
|
4,804
|
|
|
|
4,611
|
|
Net interest expense
|
|
|
9,711
|
|
|
|
13,740
|
|
|
|
31,328
|
|
|
|
45,691
|
|
% of net sales
|
|
|
1.5%
|
|
|
|
1.6%
|
|
|
|
1.6%
|
|
|
|
1.8%
|
|
Income from continuing operations before income taxes and
noncontrolling interest
|
|
|
56,836
|
|
|
|
66,594
|
|
|
|
130,633
|
|
|
|
336,401
|
|
Provision for income taxes
|
|
|
18,159
|
|
|
|
21,592
|
|
|
|
41,808
|
|
|
|
99,099
|
|
Income from continuing operations
|
|
|
38,677
|
|
|
|
45,002
|
|
|
|
88,825
|
|
|
|
237,302
|
|
Loss from discontinued operations, net of tax
|
|
|
—
|
|
|
|
(1,514)
|
|
|
|
—
|
|
|
|
(3,652)
|
|
Loss on disposal of discontinued operations, net of tax
|
|
|
(85)
|
|
|
|
(268)
|
|
|
|
(153)
|
|
|
|
(7,405)
|
|
Net income before noncontrolling interest
|
|
|
38,592
|
|
|
|
43,220
|
|
|
|
88,672
|
|
|
|
226,245
|
|
Noncontrolling interest
|
|
|
1,644
|
|
|
|
2,100
|
|
|
|
2,531
|
|
|
|
2,100
|
|
Net income attributable to Pentair, Inc.
|
|
$
|
36,948
|
|
|
$
|
41,120
|
|
|
$
|
86,141
|
|
|
$
|
224,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations attributable to Pentair, Inc.
|
|
$
|
37,033
|
|
|
$
|
42,902
|
|
|
$
|
86,294
|
|
|
$
|
235,202
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share attributable to Pentair, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
0.38
|
|
|
$
|
0.44
|
|
|
$
|
0.89
|
|
|
$
|
2.40
|
|
Discontinued operations
|
|
|
-
|
|
|
|
(0.02)
|
|
|
|
-
|
|
|
|
(0.11)
|
|
Basic earnings per common share
|
|
$
|
0.38
|
|
|
$
|
0.42
|
|
|
$
|
0.89
|
|
|
$
|
2.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
0.38
|
|
|
$
|
0.43
|
|
|
$
|
0.88
|
|
|
$
|
2.37
|
|
Discontinued operations
|
|
|
-
|
|
|
|
(0.02)
|
|
|
|
-
|
|
|
|
(0.11)
|
|
Diluted earnings per common share
|
|
$
|
0.38
|
|
|
$
|
0.41
|
|
|
$
|
0.88
|
|
|
$
|
2.26
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
97,496
|
|
|
|
97,827
|
|
|
|
97,495
|
|
|
|
98,049
|
|
Diluted
|
|
|
98,641
|
|
|
|
99,319
|
|
|
|
98,329
|
|
|
|
99,372
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share
|
|
$
|
0.18
|
|
|
$
|
0.17
|
|
|
$
|
0.54
|
|
|
$
|
0.51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Condensed Consolidated
Balance Sheets (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
In thousands
|
|
September 26
2009
|
|
|
December 31
2008
|
|
|
September 27
2008
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
50,214
|
|
|
$
|
39,344
|
|
|
$
|
93,544
|
|
Accounts and notes receivable, net
|
|
|
423,125
|
|
|
|
461,081
|
|
|
|
511,779
|
|
Inventories
|
|
|
366,416
|
|
|
|
417,287
|
|
|
|
417,525
|
|
Deferred tax assets
|
|
|
52,997
|
|
|
|
51,354
|
|
|
|
50,061
|
|
Prepaid expenses and other current assets
|
|
|
48,446
|
|
|
|
63,113
|
|
|
|
53,383
|
|
Current assets of discontinued operations
|
|
|
—
|
|
|
|
—
|
|
|
|
18,443
|
|
Total current assets
|
|
|
941,198
|
|
|
|
1,032,179
|
|
|
|
1,144,735
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
339,412
|
|
|
|
343,881
|
|
|
|
359,543
|
|
|
|
|
|
|
|
|
|
|
|
Other assets
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
2,127,082
|
|
|
|
2,101,851
|
|
|
|
2,128,430
|
|
Intangibles, net
|
|
|
506,837
|
|
|
|
515,508
|
|
|
|
534,898
|
|
Other
|
|
|
67,723
|
|
|
|
59,794
|
|
|
|
69,873
|
|
Non-current assets of discontinued operations
|
|
|
—
|
|
|
|
—
|
|
|
|
13,646
|
|
Total other assets
|
|
|
2,701,642
|
|
|
|
2,677,153
|
|
|
|
2,746,847
|
|
Total assets
|
|
$
|
3,982,252
|
|
|
$
|
4,053,213
|
|
|
$
|
4,251,125
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
Short-term borrowings
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current maturities of long-term debt
|
|
|
98
|
|
|
|
624
|
|
|
|
3,913
|
|
Accounts payable
|
|
|
199,002
|
|
|
|
217,898
|
|
|
|
224,646
|
|
Employee compensation and benefits
|
|
|
78,225
|
|
|
|
90,210
|
|
|
|
106,939
|
|
Current pension and post-retirement benefits
|
|
|
8,890
|
|
|
|
8,890
|
|
|
|
8,557
|
|
Accrued product claims and warranties
|
|
|
33,179
|
|
|
|
41,559
|
|
|
|
42,618
|
|
Income taxes
|
|
|
24,302
|
|
|
|
5,451
|
|
|
|
9,454
|
|
Accrued rebates and sales incentives
|
|
|
27,989
|
|
|
|
28,897
|
|
|
|
35,748
|
|
Other current liabilities
|
|
|
95,367
|
|
|
|
104,975
|
|
|
|
100,890
|
|
Current liabilities of discontinued operations
|
|
|
—
|
|
|
|
—
|
|
|
|
252
|
|
Total current liabilities
|
|
|
467,068
|
|
|
|
498,504
|
|
|
|
533,017
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities
|
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
814,857
|
|
|
|
953,468
|
|
|
|
1,035,150
|
|
Pension and other retirement compensation
|
|
|
264,472
|
|
|
|
270,139
|
|
|
|
164,776
|
|
Post-retirement medical and other benefits
|
|
|
32,019
|
|
|
|
34,723
|
|
|
|
34,218
|
|
Long-term income taxes payable
|
|
|
27,792
|
|
|
|
28,139
|
|
|
|
25,356
|
|
Deferred tax liabilities
|
|
|
153,984
|
|
|
|
146,559
|
|
|
|
183,780
|
|
Other non-current liabilities
|
|
|
102,924
|
|
|
|
101,612
|
|
|
|
96,941
|
|
Non-current liabilities of discontinued operations
|
|
|
—
|
|
|
|
—
|
|
|
|
1,665
|
|
Total liabilities
|
|
|
1,863,116
|
|
|
|
2,033,144
|
|
|
|
2,074,903
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity
|
|
|
2,119,136
|
|
|
|
2,020,069
|
|
|
|
2,176,222
|
|
Total liabilities and shareholders' equity
|
|
$
|
3,982,252
|
|
|
$
|
4,053,213
|
|
|
$
|
4,251,125
|
|
|
|
|
|
|
|
|
|
|
|
Days sales in accounts receivable (13 month moving average)
|
|
|
62
|
|
|
|
57
|
|
|
|
56
|
|
Days inventory on hand (13 month moving average)
|
|
|
92
|
|
|
|
79
|
|
|
|
76
|
|
Days in accounts payable (13 month moving average)
|
|
|
65
|
|
|
|
59
|
|
|
|
58
|
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Condensed Consolidated
Statements of Cash Flows (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Nine months ended
|
|
In thousands
|
|
September 26
2009
|
|
|
September 27
2008
|
|
Operating activities
|
|
|
|
|
|
|
Net income before noncontrolling interest
|
|
$
|
88,672
|
|
|
$
|
226,245
|
|
Adjustments to reconcile net income to net cash provided by (used
for) operating activities
|
|
|
|
|
|
|
Loss from discontinued operations
|
|
|
—
|
|
|
|
3,652
|
|
Loss on disposal of discontinued operations
|
|
|
153
|
|
|
|
7,405
|
|
Equity losses of unconsolidated subsidiary
|
|
|
691
|
|
|
|
2,433
|
|
Depreciation
|
|
|
44,186
|
|
|
|
44,929
|
|
Amortization
|
|
|
22,054
|
|
|
|
20,220
|
|
Deferred income taxes
|
|
|
170
|
|
|
|
25,905
|
|
Stock compensation
|
|
|
13,092
|
|
|
|
15,948
|
|
Excess tax benefits from stock-based compensation
|
|
|
(754)
|
|
|
|
(1,617)
|
|
(Gain) loss on sale of assets
|
|
|
(177)
|
|
|
|
87
|
|
Gain on sale of interest in subsidiaries
|
|
|
—
|
|
|
|
(109,648)
|
|
Changes in assets and liabilities, net of effects of business
acquisitions and dispositions
|
|
|
|
|
|
|
Accounts and notes receivable
|
|
|
46,718
|
|
|
|
(55,449)
|
|
Inventories
|
|
|
56,459
|
|
|
|
(27,109)
|
|
Prepaid expenses and other current assets
|
|
|
16,061
|
|
|
|
(15,785)
|
|
Accounts payable
|
|
|
(18,659)
|
|
|
|
2,230
|
|
Employee compensation and benefits
|
|
|
(17,883)
|
|
|
|
(7,303)
|
|
Accrued product claims and warranties
|
|
|
(8,565)
|
|
|
|
(6,572)
|
|
Income taxes
|
|
|
19,166
|
|
|
|
(6,224)
|
|
Other current liabilities
|
|
|
(9,699)
|
|
|
|
9,040
|
|
Pension and post-retirement benefits
|
|
|
(12,251)
|
|
|
|
592
|
|
Other assets and liabilities
|
|
|
747
|
|
|
|
13,143
|
|
Net cash provided by (used for) continuing operations
|
|
|
240,181
|
|
|
|
142,122
|
|
Net cash provided by (used for) operating activities of discontinued
operations
|
|
|
(1,531)
|
|
|
|
(5,243)
|
|
Net cash provided by (used for) operating activities
|
|
|
238,650
|
|
|
|
136,879
|
|
|
|
|
|
|
|
|
Investing activities
|
|
|
|
|
|
|
Capital expenditures
|
|
|
(39,306)
|
|
|
|
(39,769)
|
|
Proceeds from sale of property and equipment
|
|
|
817
|
|
|
|
4,304
|
|
Acquisitions, net of cash acquired or received
|
|
|
—
|
|
|
|
(1,609)
|
|
Divestitures
|
|
|
1,506
|
|
|
|
29,526
|
|
Other
|
|
|
(3,272)
|
|
|
|
(7)
|
|
Net cash provided by (used for) investing activities
|
|
|
(40,255)
|
|
|
|
(7,555)
|
|
|
|
|
|
|
|
|
Financing activities
|
|
|
|
|
|
|
Net short-term borrowings (repayments)
|
|
|
(16)
|
|
|
|
(14,180)
|
|
Proceeds from long-term debt
|
|
|
490,000
|
|
|
|
479,405
|
|
Repayment of long-term debt
|
|
|
(628,776)
|
|
|
|
(486,492)
|
|
Debt issuance costs
|
|
|
(50)
|
|
|
|
(114)
|
|
Excess tax benefits from stock-based compensation
|
|
|
754
|
|
|
|
1,617
|
|
Proceeds from exercise of stock options
|
|
|
1,729
|
|
|
|
5,140
|
|
Repurchases of common stock
|
|
|
—
|
|
|
|
(37,342)
|
|
Dividends paid
|
|
|
(53,162)
|
|
|
|
(50,541)
|
|
Net cash provided by (used for) financing activities
|
|
|
(189,521)
|
|
|
|
(102,507)
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
1,996
|
|
|
|
(4,068)
|
|
Change in cash and cash equivalents
|
|
|
10,870
|
|
|
|
22,749
|
|
Cash and cash equivalents, beginning of period
|
|
|
39,344
|
|
|
|
70,795
|
|
Cash and cash equivalents, end of period
|
|
$
|
50,214
|
|
|
$
|
93,544
|
|
|
|
|
|
|
|
|
Free cash flow
|
|
|
|
|
|
|
Net cash provided by (used for) continuing operations
|
|
$
|
240,181
|
|
|
$
|
142,122
|
|
Capital expenditures
|
|
|
(39,306)
|
|
|
|
(39,769)
|
|
Proceeds from sale of property and equipment
|
|
|
817
|
|
|
|
4,304
|
|
Free cash flow
|
|
$
|
201,692
|
|
|
$
|
106,657
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Supplemental Financial
Information by Reportable Business Segment (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands
|
|
First Qtr
2009
|
|
|
Second Qtr
2009
|
|
|
Third Qtr
2009
|
|
|
Nine Months
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales to external customers
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
$
|
423,932
|
|
|
$
|
486,990
|
|
|
$
|
461,570
|
|
|
$
|
1,372,492
|
|
Technical Products
|
|
|
209,908
|
|
|
|
206,722
|
|
|
|
201,095
|
|
|
|
617,725
|
|
Consolidated
|
|
$
|
633,840
|
|
|
$
|
693,712
|
|
|
$
|
662,665
|
|
|
$
|
1,990,217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intersegment sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
$
|
289
|
|
|
$
|
198
|
|
|
$
|
284
|
|
|
$
|
771
|
|
Technical Products
|
|
|
233
|
|
|
|
600
|
|
|
|
544
|
|
|
|
1,377
|
|
Other
|
|
|
(522)
|
|
|
|
(798)
|
|
|
|
(828)
|
|
|
|
(2,148)
|
|
Consolidated
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
$
|
26,976
|
|
|
$
|
49,781
|
|
|
$
|
53,085
|
|
|
$
|
129,842
|
|
Technical Products
|
|
|
20,462
|
|
|
|
23,578
|
|
|
|
24,356
|
|
|
|
68,396
|
|
Other
|
|
|
(10,224)
|
|
|
|
(9,799)
|
|
|
|
(10,759)
|
|
|
|
(30,782)
|
|
Consolidated
|
|
$
|
37,214
|
|
|
$
|
63,560
|
|
|
$
|
66,682
|
|
|
$
|
167,456
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income as a percent of net sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
|
6.4%
|
|
|
|
10.2%
|
|
|
|
11.5%
|
|
|
|
9.5%
|
|
Technical Products
|
|
|
9.7%
|
|
|
|
11.4%
|
|
|
|
12.1%
|
|
|
|
11.1%
|
|
Consolidated
|
|
|
5.9%
|
|
|
|
9.2%
|
|
|
|
10.1%
|
|
|
|
8.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands
|
|
First Qtr
2008
|
|
|
Second Qtr
2008
|
|
|
Third Qtr
2008
|
|
|
Nine Months
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales to external customers
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
$
|
544,686
|
|
|
$
|
594,118
|
|
|
$
|
557,976
|
|
|
$
|
1,696,780
|
|
Technical Products
|
|
|
285,460
|
|
|
|
304,260
|
|
|
|
297,839
|
|
|
|
887,559
|
|
Consolidated
|
|
$
|
830,146
|
|
|
$
|
898,378
|
|
|
$
|
855,815
|
|
|
$
|
2,584,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intersegment sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
$
|
372
|
|
|
$
|
139
|
|
|
$
|
305
|
|
|
$
|
816
|
|
Technical Products
|
|
|
1,138
|
|
|
|
1,034
|
|
|
|
765
|
|
|
|
2,937
|
|
Other
|
|
|
(1,510)
|
|
|
|
(1,173)
|
|
|
|
(1,070)
|
|
|
|
(3,753)
|
|
Consolidated
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
$
|
65,035
|
|
|
$
|
59,475
|
|
|
$
|
49,684
|
|
|
$
|
174,194
|
|
Technical Products
|
|
|
45,337
|
|
|
|
49,732
|
|
|
|
47,585
|
|
|
|
142,654
|
|
Other
|
|
|
(13,045)
|
|
|
|
(12,660)
|
|
|
|
(11,655)
|
|
|
|
(37,360)
|
|
Consolidated
|
|
$
|
97,327
|
|
|
$
|
96,547
|
|
|
$
|
85,614
|
|
|
$
|
279,488
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income as a percent of net sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Water
|
|
|
11.9%
|
|
|
|
10.0%
|
|
|
|
8.9%
|
|
|
|
10.3%
|
|
Technical Products
|
|
|
15.9%
|
|
|
|
16.3%
|
|
|
|
16.0%
|
|
|
|
16.1%
|
|
Consolidated
|
|
|
11.7%
|
|
|
|
10.8%
|
|
|
|
10.0%
|
|
|
|
10.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Reconciliation of the
GAAP "As Reported" year ending December 31, 2009 to the "Adjusted"
non-GAAP
excluding the effect of 2009 adjustments
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands, except per-share data
|
|
First Quarter
2009
|
|
|
Second Quarter
2009
|
|
|
Third Quarter
2009
|
|
|
Fourth Quarter
2009
|
|
|
Year
2009
|
|
Net sales
|
|
$
|
633,840
|
|
|
$
|
693,712
|
|
|
$
|
662,665
|
|
|
$655,000-$670,000
|
|
|
approx $2,650M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income - as reported
|
|
|
37,214
|
|
|
|
63,560
|
|
|
|
66,682
|
|
|
67,500 - 72,500
|
|
|
approx 237,500
|
|
% of net sales
|
|
|
5.9%
|
|
|
|
9.2%
|
|
|
|
10.1%
|
|
|
approx 10.6%
|
|
|
approx 9.0%
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and asset impairment
|
|
|
2,824
|
|
|
|
2,944
|
|
|
|
7,295
|
|
|
approx 4,500
|
|
|
approx 17,500
|
|
Operating income - as adjusted
|
|
|
40,038
|
|
|
|
66,504
|
|
|
|
73,977
|
|
|
72,000 - 77,000
|
|
|
approx 255,000
|
|
% of net sales
|
|
|
6.3%
|
|
|
|
9.6%
|
|
|
|
11.2%
|
|
|
approx 11.3%
|
|
|
approx 9.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations attributable to Pentair,
Inc. - as reported
|
|
|
17,255
|
|
|
|
32,006
|
|
|
|
37,033
|
|
|
36,500 - 40,500
|
|
|
approx 125,000
|
|
Adjustments - tax affected
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and asset impairment
|
|
|
1,864
|
|
|
|
1,943
|
|
|
|
4,815
|
|
|
approx 3,000
|
|
|
approx 11,500
|
|
Bond tender
|
|
|
—
|
|
|
|
3,171
|
|
|
|
—
|
|
|
—
|
|
|
3,171
|
|
Net income from continuing operations attributable to Pentair,
Inc. - as adjusted
|
|
|
19,119
|
|
|
|
37,120
|
|
|
|
41,848
|
|
|
39,500 - 43,500
|
|
|
approx 140,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing earnings per common share attributable to Pentair,
Inc. - diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per common share - as reported
|
|
$
|
0.18
|
|
|
$
|
0.33
|
|
|
$
|
0.38
|
|
|
$0.37 - $0.41
|
|
|
$1.25 - $1.29
|
|
Adjustments
|
|
|
0.02
|
|
|
|
0.05
|
|
|
|
0.04
|
|
|
approx 0.03
|
|
|
approx 0.15
|
|
Diluted earnings per common share - as adjusted
|
|
$
|
0.20
|
|
|
$
|
0.38
|
|
|
$
|
0.42
|
|
|
$0.40 - $0.44
|
|
|
$1.40 - $1.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding - Diluted
|
|
|
97,966
|
|
|
|
98,422
|
|
|
|
98,641
|
|
|
98,900
|
|
|
98,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Reconciliation of the
GAAP "As Reported" year ending December 31, 2008 to the "Adjusted"
non-GAAP
excluding the effect of 2008 adjustments
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands, except per-share data
|
|
First Quarter
2008
|
|
|
Second Quarter
2008
|
|
|
Third Quarter
2008
|
|
|
Fourth Quarter
2008
|
|
|
Year
2008
|
|
Net sales
|
|
$
|
830,146
|
|
|
$
|
898,378
|
|
|
$
|
855,815
|
|
|
$
|
767,637
|
|
|
$
|
3,351,976
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income - as reported
|
|
|
97,327
|
|
|
|
96,547
|
|
|
|
85,614
|
|
|
|
45,197
|
|
|
|
324,685
|
|
% of net sales
|
|
|
11.7%
|
|
|
|
10.7%
|
|
|
|
10.0%
|
|
|
|
5.9%
|
|
|
|
9.7%
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and asset impairment
|
|
|
—
|
|
|
|
2,586
|
|
|
|
15,207
|
|
|
|
28,377
|
|
|
|
46,170
|
|
Horizon settlement
|
|
|
—
|
|
|
|
20,435
|
|
|
|
—
|
|
|
|
—
|
|
|
|
20,435
|
|
Operating income - as adjusted
|
|
|
97,327
|
|
|
|
119,568
|
|
|
|
100,821
|
|
|
|
73,574
|
|
|
|
391,290
|
|
% of net sales
|
|
|
11.7%
|
|
|
|
13.3%
|
|
|
|
11.8%
|
|
|
|
9.6%
|
|
|
|
11.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations attributable to Pentair,
Inc. - as reported
|
|
|
52,463
|
|
|
|
139,837
|
|
|
|
42,902
|
|
|
|
21,161
|
|
|
|
256,363
|
|
Adjustments - tax affected
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and asset impairment
|
|
|
—
|
|
|
|
1,707
|
|
|
|
10,037
|
|
|
|
18,729
|
|
|
|
30,473
|
|
Horizon settlement
|
|
|
—
|
|
|
|
13,487
|
|
|
|
—
|
|
|
|
—
|
|
|
|
13,487
|
|
Gain on PRF transaction
|
|
|
—
|
|
|
|
(85,832)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(85,832)
|
|
Bond tender
|
|
|
—
|
|
|
|
—
|
|
|
|
3,043
|
|
|
|
—
|
|
|
|
3,043
|
|
Net income from continuing operations attributable to Pentair,
Inc. - as adjusted
|
|
|
52,463
|
|
|
|
69,199
|
|
|
|
55,982
|
|
|
|
39,890
|
|
|
|
217,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing earnings per common share attributable to Pentair,
Inc. - diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per common share - as reported
|
|
$
|
0.53
|
|
|
$
|
1.41
|
|
|
$
|
0.43
|
|
|
$
|
0.22
|
|
|
$
|
2.59
|
|
Adjustments
|
|
|
—
|
|
|
|
(0.71)
|
|
|
|
0.13
|
|
|
|
0.19
|
|
|
|
(0.39)
|
|
Diluted earnings per common share - as adjusted
|
|
$
|
0.53
|
|
|
$
|
0.70
|
|
|
$
|
0.56
|
|
|
$
|
0.41
|
|
|
$
|
2.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding - Diluted
|
|
|
99,558
|
|
|
|
99,509
|
|
|
|
99,319
|
|
|
|
98,299
|
|
|
|
99,068
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Reconciliation of the
GAAP "As Reported" year ending December 31, 2009 to the "Adjusted"
non-GAAP
excluding the effect of 2009 adjustments
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands
|
|
First Quarter
2009
|
|
|
Second Quarter
2009
|
|
|
Third Quarter
2009
|
|
|
Fourth Quarter
2009
|
|
|
Year
2009
|
|
Water
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
423,932
|
|
|
$
|
486,990
|
|
|
$
|
461,570
|
|
|
$
|
445,000-$455,000
|
|
|
approx $1,825M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income - as reported
|
|
|
26,976
|
|
|
|
49,781
|
|
|
|
53,085
|
|
|
|
52,000-57,000
|
|
|
|
182,000-187,000
|
|
% of net sales
|
|
|
6.4%
|
|
|
|
10.2%
|
|
|
|
11.5%
|
|
|
|
11.4% - 12.8%
|
|
|
approx 10.1%
|
|
Adjustments - restructuring and asset impairment
|
|
|
1,464
|
|
|
|
1,460
|
|
|
|
2,639
|
|
|
approx 1,500
|
|
|
approx 7,000
|
|
Operating income - as adjusted
|
|
|
28,440
|
|
|
|
51,241
|
|
|
|
55,724
|
|
|
|
53,500-58,500
|
|
|
|
189,000-194,000
|
|
% of net sales
|
|
|
6.7%
|
|
|
|
10.5%
|
|
|
|
12.1%
|
|
|
|
11.8% - 13.1%
|
|
|
approx 10.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Technical Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
209,908
|
|
|
$
|
206,722
|
|
|
$
|
201,095
|
|
|
$
|
210,000-$215,000
|
|
|
approx $830M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income - as reported
|
|
|
20,462
|
|
|
|
23,578
|
|
|
|
24,356
|
|
|
|
27,000-32,000
|
|
|
|
95,500-100,500
|
|
% of net sales
|
|
|
9.7%
|
|
|
|
11.4%
|
|
|
|
12.1%
|
|
|
|
12.6% - 15.2%
|
|
|
approx 11.8%
|
|
Adjustments - restructuring and asset impairment
|
|
|
792
|
|
|
|
1,139
|
|
|
|
4,557
|
|
|
approx 3,000
|
|
|
approx 9,500
|
|
Operating income - as adjusted
|
|
|
21,254
|
|
|
|
24,717
|
|
|
|
28,913
|
|
|
|
30,000-35,000
|
|
|
|
105,000-110,000
|
|
% of net sales
|
|
|
10.1%
|
|
|
|
12.0%
|
|
|
|
14.4%
|
|
|
|
14.0% - 16.7%
|
|
|
approx 13.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pentair, Inc. and Subsidiaries
Reconciliation of the
GAAP "As Reported" year ending December 31, 2008 to the "Adjusted"
non-GAAP
excluding the effect of 2008 adjustments
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands
|
|
First Quarter
2008
|
|
|
Second Quarter
2008
|
|
|
Third Quarter
2008
|
|
|
Fourth Quarter
2008
|
|
|
Year
2008
|
|
Water
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
544,686
|
|
|
$
|
594,118
|
|
|
$
|
557,976
|
|
|
$
|
509,362
|
|
|
$
|
2,206,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income - as reported
|
|
|
65,035
|
|
|
|
59,475
|
|
|
|
49,684
|
|
|
|
32,163
|
|
|
|
206,357
|
|
% of net sales
|
|
|
11.9%
|
|
|
|
10.0%
|
|
|
|
8.9%
|
|
|
|
6.3%
|
|
|
|
9.4%
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and asset impairment
|
|
|
—
|
|
|
|
2,157
|
|
|
|
13,438
|
|
|
|
19,628
|
|
|
|
35,223
|
|
Horizon settlement
|
|
|
—
|
|
|
|
20,435
|
|
|
|
—
|
|
|
|
—
|
|
|
|
20,435
|
|
Operating income - as adjusted
|
|
|
65,035
|
|
|
|
82,067
|
|
|
|
63,122
|
|
|
|
51,791
|
|
|
|
262,015
|
|
% of net sales
|
|
|
11.9%
|
|
|
|
13.8%
|
|
|
|
11.3%
|
|
|
|
10.2%
|
|
|
|
11.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Technical Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
285,460
|
|
|
$
|
304,260
|
|
|
$
|
297,839
|
|
|
$
|
258,275
|
|
|
$
|
1,145,834
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income - as reported
|
|
|
45,337
|
|
|
|
49,732
|
|
|
|
47,585
|
|
|
|
26,661
|
|
|
|
169,315
|
|
% of net sales
|
|
|
15.9%
|
|
|
|
16.3%
|
|
|
|
16.0%
|
|
|
|
10.3%
|
|
|
|
14.8%
|
|
Adjustments - restructuring and asset impairment
|
|
|
—
|
|
|
|
429
|
|
|
|
633
|
|
|
|
7,209
|
|
|
|
8,271
|
|
Operating income - as adjusted
|
|
|
45,337
|
|
|
|
50,161
|
|
|
|
48,218
|
|
|
|
33,870
|
|
|
|
177,586
|
|
% of net sales
|
|
|
15.9%
|
|
|
|
16.4%
|
|
|
|
16.2%
|
|
|
|
13.1%
|
|
|
|
15.5%
|
Source: Pentair, Inc.
Pentair
Todd Gleason, 763-656-5570
Vice President,
Strategic Planning & Investor Relations
[email protected]