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Pentair Announces Full Year 2008 Net Earnings Per Share From Continuing Operations of $2.59; Adjusted EPS of $2.20, Up Five Percent
02.03.2009

MINNEAPOLIS--(BUSINESS WIRE)-- Pentair, Inc. (NYSE:PNR):

  • Delivers record full year net earnings per share from continuing operations (EPS) of $2.59; or $2.20 on adjusted basis, up 5 percent versus 2007 adjusted EPS of $2.09
  • Reports fourth quarter sales of $768 million, down 5 percent year over year
  • Announces fourth quarter EPS of 22 cents or 41 cents on an adjusted basis

Adjusted 2008 and 2007 EPS exclude the impact of gains/losses from acquisitions and divestitures (2008), the settlement of the Horizon litigation (2008) and the negative impact associated with restructuring costs and impairment charges (2008 and 2007) and the one-time net tax benefits (2007). Adjusted 2008 and 2007 Operating Income and Margins exclude the settlement of the Horizon litigation, the negative impact associated with restructuring costs and impairment charges in the respective period. 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.

Pentair, Inc. (NYSE:PNR) today announced fourth quarter 2008 net earnings per diluted share from continuing operations (EPS) of $0.22. This represents a decrease of 55 percent as compared to the $0.49 of EPS in the fourth quarter last year. Current period results include a negative $0.19 per share impact from restructuring and impairment charges. Adjusting for these items, fourth quarter 2008 EPS was $0.41, down 21 percent when compared to the year-earlier adjusted EPS of $0.52. The $0.41 per share of adjusted earnings was at the midpoint of the per share adjusted earnings guidance range of $0.40 to $0.42 that the company provided in December 2008.

Total company fourth quarter sales decreased five percent to $768 million, compared with $807 million in the fourth quarter of 2007. The company delivered fourth quarter operating income of $45 million. Excluding the effects of restructuring and impairment charges, the company delivered operating income of $74 million versus $97 million in the year-ago quarter. The company’s adjusted operating income included the negative impact of $3 million of integration and intangible amortization related to the second quarter 2008 transaction with GE Water & Process Technologies, a unit of the General Electric Company (GE), to combine the companies’ respective residential water filtration businesses into Pentair Residential Filtration (PRF). Overall, adjusted operating margins for the fourth quarter contracted 240 basis points to 9.6 percent. A positive 400 basis point impact from price and productivity did not offset a negative 640 basis point impact related to total inflation, lower sales volume and foreign exchange.

“Through the first three quarters of 2008, a period when we met or exceeded our financial outlook, we recognized the global economy was slowing and we began taking aggressive cost reduction actions,” said Randall J. Hogan, Pentair chairman and CEO. “However, as we exited the third quarter, the speed and magnitude of the economic deterioration increased dramatically. This caused us to miss our original fourth quarter sales and earnings forecasts and set into motion an acceleration of additional cost actions. By the end of 2009, when compared to June of 2008, we will have reduced our headcount by over 15 percent and closed 17 facilities,” he added.

FOURTH QUARTER BUSINESS HIGHLIGHTS

The Water Group delivered $509 million in sales, a six percent decline year-over-year. The formation of PRF added three points of growth and foreign exchange reduced sales by two points. Slowing international and non-residential markets joined continuing softness in North American residential markets to negatively impact sales.

  • Global Flow Technologies sales were down five percent versus the year-ago quarter. Sales growth in pump equipment for global commercial, municipal and agricultural markets did not outpace further declines in North American and European residential markets.
  • Global Filtration sales declined two percent, or down twelve percent organically offset by the increased sales associated with PRF. Sales increases in the industrial filtration and desalination vertical markets did not offset declines in North American and European residential markets and in global foodservice markets.
  • Global Pool Equipment sales were down 12 percent as sales increases to commercial pool markets could not offset the prolonged decline in residential pool markets.
  • Europe, Middle East and Africa sales declined seven percent versus the year-ago quarter as Western European economies continued to slow in the fourth quarter.
  • Asia-Pacific sales declined seven percent as growth in China and India did not overcome volume declines and negative currency fluctuations in Australia and New Zealand.

The Water Group’s fourth quarter operating income totaled $32 million, a decrease of 51 percent as compared to $65 million in the same period last year. Excluding the effects of restructuring and impairment charges, the Group’s operating income was $52 million or 25 percent lower than the $69 million in the year-ago period. Adjusted operating margins of 10.2 percent contracted 250 basis points as the benefit from productivity actions and positive price did not offset the negative impact from inflation, decreased volumes and integration costs associated with the formation of PRF.

Technical Products delivered fourth quarter 2008 sales of $258 million, a decrease of two percent versus the year-earlier period as industrial and commercial demand slowed throughout the quarter.

  • Total electrical sales were up slightly as growth in energy, network and commercial overcame contraction in automotive and machine tools and other key markets.
  • Global electronic sales decreased approximately six percent as each major region experienced year-over-year sales declines.

Technical Products’ fourth quarter reported operating income totaled $27 million, a decrease of 33 percent as compared to $40 million in the same quarter last year. Adjusting for restructuring expenses and impairment charges, operating income totaled $34 million, down 19 percent versus the $42 million in the fourth quarter 2007. Adjusted operating margins were 13.1 percent, a decrease of 260 basis points versus the year-ago period. In the quarter, the benefits from productivity and price could not offset the negative impact from total inflation, predominantly steel costs, and foreign exchange.

“The insurmountable combination of sales volume declines, high period-costs for steel and other materials, and actions we took to temporarily curb production in December impacted margins in the fourth quarter considerably,” said Hogan. “However, we are taking aggressive actions to align our cost structure and growth strategies to reflect the reality of the economy.”

FISCAL YEAR 2008 RESULTS

Total company sales of $3.35 billion for fiscal year 2008 increased 2.2 percent from $3.28 billion a year ago. For the year, the company reported EPS of $2.59. This represents an increase of 22 percent as compared to the $2.12 of reported EPS in 2007. Full year 2008 results included the favorable impact of the 86 cents per share gain from the formation of PRF, the negative 33 cents per share impact from restructuring actions and impairment charges and the negative 14 cents per share impact from the settlement of the Horizon litigation. Full year 2007 adjusted EPS of $2.09 excluded the favorable impact of $0.13 per share from one-time net tax benefits and a negative $0.10 per share impact from restructuring costs.

For the year, Pentair generated $164 million in free cash flow. Excluding the impact of $28 million for the settlement of the Horizon litigation, $18 million for restructuring and related expenses and $8 million for pension fund contributions, free cash flow was $218 million. In 2007, the company generated $281 million of free cash flow on a continuing operations basis. In 2008, the company paid a $0.68 dividend for each share of common stock and repurchased 1.55 million shares of stock in 2008. The company recently announced a dividend increase to $0.72 for each share of common stock.

“Pentair delivered solid results in 2008 despite a tumultuous economic environment that included unplanned headwinds around commodities, currency, and market-based credit and financial crises,” said Hogan. “We generated record full year sales and earnings per share, we improved our portfolio by divesting three non-core businesses and we strengthened our position in filtration by the formation of PRF. We exit the year with new technologies, more global distribution capabilities, a leaner manufacturing footprint and many actions underway that will enable us to remain competitive.”

OUTLOOK

The company updates first quarter 2009 earnings per share guidance in the range of $0.20 to $0.30, a decrease of 43 to 62 percent year-over-year. The updated first quarter guidance range reflects additional in-the-period restructuring expenses associated with increased severance costs, plant shutdowns, and a continued curbing of production early in the quarter. The company maintains its full year 2009 EPS guidance range of $1.70 to $2.00, a decrease of 9 to 23 percent versus 2008 adjusted EPS. The company expects full year 2009 free cash flow to equal or exceed net income.

“We expect our quarterly 2009 earnings results will improve sequentially as we realize the benefits of our cost actions and the benefit of approximately three percent net material deflation,” said Hogan. “However, we expect first quarter 2009 results will be down significantly year-over-year. In the first quarter of 2009, we are forecasting sales levels at December 2008 run-rates levels in each business except for our Pool business, which we believe will be more negative. Additionally, restructuring related expenses will be at their peak early in the year. Unfortunately, the benefits from those restructuring actions, as well as from material deflation, will not yet have been realized in our first quarter operating results,” Hogan added.

“Given the uncertain depth and length of the global recession, our full year 2009 outlook reflects our expectation that sales volumes across our four global business units will decline around 10 percent as the economic environment remains soft,” said Hogan. “While we don’t see the global economy improving in 2009, we believe that when it does improve our structural cost reductions and improved end-market focus position us for rapid earnings growth and cash flow generation.”

EARNINGS CONFERENCE CALL

Pentair Chairman and CEO Randall J. Hogan and Chief Financial Officer John L. Stauch will discuss the Company’s 2008 performance, and first quarter and full year 2009 guidance on a two-way conference call with investors at 12:00 p.m. Eastern today. Reconciliation of any non-GAAP financial measures are set forth in the attachments to this fourth quarter 2008 earnings release and in the fourth quarter 2008 earnings 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 integrate acquisitions successfully and the risk that expected synergies may not be fully realized or may take longer to realize than expected; foreign currency effects; retail 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 15,000 people worldwide.

Pentair, Inc. and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
       
Three months ended   Year ended
December 31 December 31 December 31 December 31
In thousands, except per-share data

 

  2008       2007       2008       2007  
Net sales $ 767,637 $ 806,670 $ 3,351,976 $ 3,280,903
Cost of goods sold     538,144       551,123       2,337,426       2,268,205  
Gross profit 229,493 255,547 1,014,550 1,012,698

% of net sales

29.9 % 31.7 % 30.3 % 30.9 %
Selling, general and administrative 169,149 150,424 606,980 576,828

% of net sales

22.0 % 18.6 % 18.1 % 17.6 %
Research and development 15,147 14,123 62,450 56,821

% of net sales

2.0 % 1.8 % 1.9 % 1.7 %
Legal settlement                 20,435        
Operating income 45,197 91,000 324,685 379,049

% of net sales

5.9 % 11.3 % 9.7 % 11.6 %
 
Other (income) expense:
 
Gain on sale of interest in subsidiaries (109,648 )
Equity losses of unconsolidated subsidiary 608 1,027 3,041 2,865
Loss on early extinguishment of debt 4,611
Net interest expense 13,744 16,907 59,435 68,393

% of net sales

1.8 % 2.1 % 1.8 % 2.1 %
Other     106       1,230       106       1,230  
Income from continuing operations before income taxes and minority interest 30,739 71,836 367,140 306,561

% of net sales

4.0 % 8.9 % 11.0 % 9.3 %
Provision for income taxes 9,245 22,758 108,344 94,443

Effective tax rate

30.1 % 31.8 % 29.5 % 30.8 %
Minority interest     333             2,433        
Income from continuing operations 21,161 49,078 256,363 212,118
Loss from discontinued operations, net of tax (2,131 ) (764 ) (5,783 ) (1,629 )
Gain (loss) on disposal of discontinued operations, net of tax     (14,441 )     231       (21,846 )     438  
Net income   $ 4,589     $ 48,545     $ 228,734     $ 210,927  
 
Earnings (loss) per common share
Basic
Continuing operations $ 0.22 $ 0.50 $ 2.62 $ 2.15
Discontinued operations     (0.17 )     (0.01 )     (0.28 )     (0.01 )
Basic earnings per common share   $ 0.05     $ 0.49     $ 2.34     $ 2.14  
 
Diluted
Continuing operations $ 0.22 $ 0.49 $ 2.59 $ 2.12
Discontinued operations     (0.17 )     (0.01 )     (0.28 )     (0.01 )
Diluted earnings per common share   $ 0.05     $ 0.48     $ 2.31     $ 2.11  
 
Weighted average common shares outstanding
Basic 97,422 98,448 97,887 98,762
Diluted 98,299 99,859 99,068 100,205
 
Cash dividends declared per common share $ 0.17 $ 0.15 $ 0.68 $ 0.60
 
Pentair, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
   

December 31

December 31

In thousands   2008   2007
Assets
Current assets
Cash and cash equivalents $ 39,344 $ 70,795
Accounts and notes receivable, net 461,081 461,408
Inventories 417,287 379,018
Deferred tax assets 51,354 50,511
Prepaid expenses and other current assets 63,113 35,799
Current assets of discontinued operations         40,490
Total current assets 1,032,179 1,038,021
 
Property, plant and equipment, net 343,881 361,690
 
Other assets
Goodwill 2,101,851 1,999,119
Intangibles, net 515,508 487,028
Other 59,794 82,238
Non-current assets of discontinued operations         32,518
Total other assets     2,677,153     2,600,903
Total assets   $ 4,053,213   $ 4,000,614
 
Liabilities and Shareholders' Equity
Current liabilities
Short-term borrowings $ $ 13,586
Current maturities of long-term debt 624 5,075
Accounts payable 217,898 227,786
Employee compensation and benefits 90,210 111,082
Current pension and post-retirement benefits 8,890 8,557
Accrued product claims and warranties 41,559 49,077
Income taxes 5,451 14,999
Accrued rebates and sales incentives 28,897 36,430
Other current liabilities 104,975 90,021
Current liabilities of discontinued operations         3,704
Total current liabilities 498,504 560,317
 
Other liabilities
Long-term debt 953,468 1,041,925
Pension and other retirement compensation 270,139 161,042
Post-retirement medical and other benefits 34,723 37,147
Long-term income taxes payable 28,139 21,306
Deferred tax liabilities 146,559 166,917
Other non-current liabilities 101,612 97,085
Non-current liabilities of discontinued operations         4,004
Total liabilities 2,033,144 2,089,743
 
Minority interest 121,388
 
Shareholders' equity     1,898,681     1,910,871
Total liabilities and shareholders' equity   $ 4,053,213   $ 4,000,614
 
Days sales in accounts receivable (13 month moving average) 57 53
Days inventory on hand (13 month moving average) 79 74
Days in accounts payable (13 month moving average) 59 55
Debt/total capital 33.4% 35.7%
 
Pentair, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
   
Year ended
December 31 December 31
In thousands     2008       2007  
Operating activities
Net income $ 228,734 $ 210,927
Adjustments to reconcile net income to net cash provided by (used for) operating activities
Loss from discontinued operations 5,783 1,629
(Gain) loss on disposal of discontinued operations 21,846 (438 )
Equity losses of unconsolidated subsidiary 3,041 2,865
Minority interest 2,433
Depreciation 59,673 57,603
Amortization 27,608 25,561
Deferred income taxes 40,754 (16,652 )
Stock compensation 20,572 22,913
Excess tax benefits from stock-based compensation (1,617 ) (4,204 )
Other 510 (1,929 )
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

(18,247 ) (19,068 )

Inventories

(33,311 ) 14,714

Prepaid expenses and other current assets

(27,394 ) 2,175

Accounts payable

(1,973 ) 19,482

Employee compensation and benefits

(21,919 ) 3,995

Accrued product claims and warranties

(7,286 ) 4,763

Income taxes

(4,409 ) 2,849

Other current liabilities

8,987 (3,218 )

Pension and post-retirement benefits

301 6

Other assets and liabilities

    18,174       13,017  

Net cash provided by (used for) continuing operations

212,612 336,990

Net cash provided by (used for) operating activities of discontinued operations

    (8,397 )     4,288  

Net cash provided by (used for) operating activities

204,215 341,278
 
Investing activities
Capital expenditures (53,089 ) (61,516 )
Proceeds from sale of property and equipment 4,741 5,198
Acquisitions, net of cash acquired or received (2,027 ) (487,561 )
Divestitures 37,907
Other     (12 )     (5,544 )

Net cash provided by (used for) investing activities

(12,480 ) (549,423 )
 
Financing activities
Net short-term borrowings (repayments) (16,994 ) (1,830 )
Proceeds from long-term debt 715,000 1,269,428
Repayment of long-term debt (805,016 ) (954,077 )
Debt issuance costs (114 ) (1,876 )
Excess tax benefits from stock-based compensation 1,617 4,204
Proceeds from exercise of stock options 5,590 7,388
Repurchases of common stock (50,000 ) (40,641 )
Dividends paid     (67,284 )     (59,910 )

Net cash provided by (used for) financing activities

(217,201 ) 222,686
 
Effect of exchange rate changes on cash and cash equivalents     (5,985 )     1,434  
Change in cash and cash equivalents (31,451 ) 15,975
Cash and cash equivalents, beginning of period     70,795       54,820  
Cash and cash equivalents, end of period   $ 39,344     $ 70,795  
 
Free cash flow        
Net cash provided by (used for) continuing operations $ 212,612 $ 336,990
Capital expenditures (53,089 ) (61,516 )
Proceeds from sale of property and equipment     4,741       5,198  
Free cash flow   $ 164,264     $ 280,672  
 
Pentair, Inc. and Subsidiaries
Supplemental Financial Information by Reportable Business Segment for 2008 (Unaudited)
         
 
First Qtr Second Qtr Third Qtr Fourth Qtr Year
In thousands     2008       2008       2008       2008       2008  
 
Net sales to external customers
Water $ 544,686 $ 594,118 $ 557,976 $ 509,362 $ 2,206,142
Technical Products     285,460       304,260       297,839       258,275       1,145,834  
Consolidated   $ 830,146     $ 898,378     $ 855,815     $ 767,637     $ 3,351,976  
 
Intersegment sales
Water $ 372 $ 139 $ 305 $ 228 $ 1,044
Technical Products 1,138 1,034 765 1,081 4,018
Other     (1,510 )     (1,173 )     (1,070 )     (1,309 )     (5,062 )
Consolidated   $     $     $     $     $  
 
Operating income (loss)
Water $ 65,035 $ 59,475 $ 49,684 $ 32,163 $ 206,357
Technical Products 45,337 49,732 47,585 26,661 169,315
Other     (13,045 )     (12,660 )     (11,655 )     (13,627 )     (50,987 )
Consolidated   $ 97,327     $ 96,547     $ 85,614     $ 45,197     $ 324,685  
 
Operating income as a percent of net sales
Water 11.9 % 10.0 % 8.9 % 6.3 % 9.4 %
Technical Products 15.9 % 16.3 % 16.0 % 10.3 % 14.8 %
Consolidated 11.7 % 10.7 % 10.0 % 5.9 % 9.7 %
 
 
Pentair, Inc. and Subsidiaries
Supplemental Financial Information by Reportable Business Segment for 2007 (Unaudited)
 
 
First Qtr Second Qtr Third Qtr Fourth Qtr Year
In thousands     2007       2007       2007       2007       2007  
 
Net sales to external customers
Water $ 527,703 $ 627,420 $ 533,676 $ 541,971 $ 2,230,770
Technical Products     252,583       257,150       275,701       264,699       1,050,133  
Consolidated   $ 780,286     $ 884,570     $ 809,377     $ 806,670     $ 3,280,903  
 
Intersegment sales
Water $ 214 $ 46 $ 207 $ 196 $ 663
Technical Products 896 1,689 1,526 1,192 5,303
Other     (1,110 )     (1,735 )     (1,733 )     (1,388 )     (5,966 )
Consolidated   $     $     $     $     $  
 
Operating income (loss)
Water $ 63,535 $ 89,394 $ 55,615 $ 65,133 $ 273,677
Technical Products 31,631 36,140 46,237 39,578 153,586
Other     (12,665 )     (12,582 )     (9,256 )     (13,711 )     (48,214 )
Consolidated   $ 82,501     $ 112,952     $ 92,596     $ 91,000     $ 379,049  
 
Operating income as a percent of net sales
Water 12.0 % 14.2 % 10.4 % 12.0 % 12.3 %
Technical Products 12.5 % 14.1 % 16.8 % 15.0 % 14.6 %
Consolidated 10.6 % 12.8 % 11.4 % 11.3 % 11.6 %
 
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)
         
 
First Quarter Second Quarter Third Quarter Fourth Quarter Year
In thousands, except per-share data     2008       2008       2008       2008       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 %
 
Income from continuing operations - 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 30,472
Horizon settlement 13,487 13,487
Gain on PRF transaction (85,832 ) (85,832 )
Bond tender                 3,043             3,043  
Income from continuing operations - as adjusted     52,463       69,199       55,982       39,890       217,534  
 
Continuing earnings per common share - 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, 2007 to the "Adjusted" non-GAAP
excluding the effect of 2007 adjustments (Unaudited)
 
 
First Quarter Second Quarter Third Quarter Fourth Quarter Year
In thousands, except per-share data     2007       2007       2007       2007       2007  
Net sales   $ 780,286     $ 884,570     $ 809,377     $ 806,670     $ 3,280,903   *
 
Operating income - as reported 82,501 112,952 92,596 91,000 379,049 *
% of net sales 10.6 % 12.8 % 11.4 % 11.3 % 11.6 %
Adjustments                 9,192       5,970       15,162  
Operating income - as adjusted 82,501 112,952 101,788 96,970 394,211
% of net sales 10.6 % 12.8 % 12.6 % 12.0 % 12.0 %
 
Income from continuing operations - as reported 43,197 60,976 58,867 49,078 212,118 *
Adjustments - tax affected 6,246 3,881 10,127
Non-recurring tax items     (145 )     (83 )     (11,517 )     (1,073 )     (12,818 )
Income from continuing operations - as adjusted     43,052       60,893       53,596       51,886       209,427  
 
Continuing earnings per common share - diluted
Diluted earnings per common share - as reported $ 0.43 $ 0.61 $ 0.59 $ 0.49 $ 2.12
Adjustments                 (0.06 )     0.03       (0.03 )
Diluted earnings per common share - as adjusted   $ 0.43     $ 0.61     $ 0.53     $ 0.52     $ 2.09  
 
 
Weighted average common shares outstanding - Diluted 100,271 100,371 100,365 99,859 100,205
 
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)
         
 
First Quarter Second Quarter Third Quarter Fourth Quarter Year
In thousands     2008       2008       2008       2008       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 %
 
 
Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP "As Reported" year ending December 31, 2007 to the "Adjusted" non-GAAP
excluding the effect of 2007 adjustments (Unaudited)
 
 
First Quarter Second Quarter Third Quarter Fourth Quarter Year
In thousands     2007       2007       2007       2007       2007  
Water
Net sales   $ 527,703     $ 627,420     $ 533,676     $ 541,971     $ 2,230,770   *
 
Operating income - as reported 63,535 89,394 55,615 65,133 273,677 *
% of net sales 12.0 % 14.2 % 10.4 % 12.0 % 12.3 %
Adjustments                 9,843       3,897       13,740  
Operating income - as adjusted 63,535 89,394 65,458 69,030 287,417
% of net sales 12.0 % 14.2 % 12.3 % 12.7 % 12.9 %
 
 
Technical Products
Net sales   $ 252,583     $ 257,150     $ 275,701     $ 264,699     $ 1,050,133  
 
Operating income - as reported 31,631 36,140 46,237 39,578 153,586
% of net sales 12.5 % 14.1 % 16.8 % 15.0 % 14.6 %
Adjustments                 (652 )     2,073       1,421  
Operating income - as adjusted 31,631 36,140 45,585 41,651 155,007
% of net sales 12.5 % 14.1 % 16.5 % 15.7 % 14.8 %

Source: Pentair, Inc.

Pentair
Todd Gleason, 763-656-5570
Vice President, Strategic Planning & Investor Relations
todd.gleason@pentair.com
or
Media Inquiries:
Betsy Day, 763-656-5537

Categories: Press Releases