Pentair (PNR) investor relations material

Executive summary

• Achieved record Q1 sales of $1,037 million, up 3% year-over-year, with core sales growth of 1% and strong performance across Flow, Water Solutions, and Pool segments, despite residential market headwinds.

• Adjusted EPS rose 10% to $1.22, GAAP EPS increased 5% to $0.98, and adjusted operating income grew 7% to $259 million.

• Margin expansion continued for the 16th consecutive quarter, with adjusted return on sales (ROS) up 100 basis points to 25.0%.

• Repurchased $200 million in shares and marked 50 consecutive years of dividend increases, with the quarterly dividend raised to $0.27 per share.

• Continued investment in innovation, digital, and AI-enabled solutions, and ongoing transformation and restructuring initiatives.

Financial highlights

• Q1 sales reached $1,037 million (up 3% year-over-year); adjusted operating income was $259 million (up 7%); adjusted EPS was $1.22 (up 10%).

• Gross profit margin improved to 41.8% from 39.9% year-over-year; operating margin was 20.3% (GAAP) and 25.0% (adjusted).

• Free cash flow was negative at $(86) million, reflecting seasonal working capital outflows.

• Net debt leverage ratio at 1.7x; total debt at quarter-end was $1,944 million.

• Cash and cash equivalents at quarter-end were $67.7 million.

Outlook and guidance

• Full-year 2026 adjusted EPS guidance raised to $5.30–$5.40 (up 8–10%); GAAP EPS guidance raised to $4.83–$4.93 (up 23–25%).

• Full-year 2026 sales expected to grow 2–4%; Q2 2026 sales expected up ~1%, with adjusted EPS guidance of $1.47–$1.50 (up 6–8%).

• Expect $70 million in productivity gains for 2026, with price actions to offset inflation and tariffs.

• Capital expenditures for 2026 projected at ~$80 million; EBITDA outlook at ~$1.2 billion.

• Pillar Two global minimum tax rules expected to continue impacting the effective tax rate.