PENTAIR 2014 Electrical Products Group Conference
PentairElectrical Products Group Conference
John L. StauchChief Financial Officer
May 21, 2014
PENTAIR 2014 Electrical Products Group Conference 2
FORWARD-LOOKING STATEMENTS
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This communication contains statements that we believe to be “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact are forward-looking
statements. Without limitation, any statements preceded or followed by or that include the words “targets,” “goals,” “plans,”
“believes,” “expects,” “intends,” “will,” “likely,” “may,” “anticipates,” “estimates,” “projects,” “should,” “would,”
“positioned,” “strategy,” “future,” "outlook," "opportunity" or words, phrases or terms of similar substance or the negative
thereof, are forward-looking statements. These forward-looking statements are not guarantees of future performance and
are subject to risks, uncertainties, assumptions and other factors, some of which are beyond our control, which could cause
actual results to differ materially from those expressed or implied by such forward-looking statements. These factors
include the ability to successfully complete the Redomicile and achieve the expected benefits from the Redomicile; the
ability to successfully integrate the Flow Control business and achieve expected benefits from such combination; overall
global economic and business conditions; competition and pricing pressures in the markets we serve; the strength of
housing and related markets; volatility in currency exchange rates and commodity prices; inability to generate savings from
excellence in operations initiatives consisting of lean enterprise, supply management and cash flow practices; increased
risks associated with operating foreign businesses; the ability to deliver backlog and win future project work; failure of
markets to accept new product introductions and enhancements; the impact of changes in laws and regulations, including
those that limit U.S. tax benefits; the outcome of litigation and governmental proceedings; and the ability to achieve our
long-term strategic operating goals. Additional information concerning these and other factors is contained in our filings
with the U.S. Securities and Exchange Commission, including in our 2013 Annual Report on Form 10-K. All forward-looking
statements speak only as of the date of this communication. Pentair Ltd. assumes no obligation, and disclaims any
obligation, to update the information contained in this communication.
PENTAIR 2014 Electrical Products Group Conference 3
KEY DEFINITIONS
• All References to 2015, 2016, and 2017 Represent Our Long Term
Strategic Goals
• Except as Otherwise Noted, and Except for Sales, All References to
2014 Represent Our Results for the Period Indicated Presented on
an Adjusted Basis
• Except as Otherwise Noted, and Except for Sales, All References to
2013 are Presented on an Adjusted Basis
• Except as Otherwise Noted, All References to 2012 are Presented
on an Adjusted, Pro Forma Basis to Include the Results of the Flow
Control Acquisition
• See Appendix for GAAP to Non-GAAP Reconciliations
PENTAIR 2014 Electrical Products Group Conference
KEY MESSAGES
• We Continue to Expect to Deliver ~$5.00 EPS by 2015
• Productivity & Synergies Solidifying
• Sustained and Predictable Growth is Goal
• We Are Optimistic About 2016 and Beyond
Delivering on Commitments One Quarter at a Time4
PENTAIR 2014 Electrical Products Group Conference
GLOBAL PENTAIR PORTFOLIO – 2013 SALES
Pentair has a Balanced Portfolio
By Reporting Segment By Vertical
• Long & Short Cycle
Balanced Portfolio
• Global Solutions /
Recognized Brands
• Largest “Valve
Company” Globally
• Balanced Geographic
Exposure with 25% in
Fast Growth Regions
• Current Trends: US
Strength and Western
Europe has Stabilized
• Balanced Across
Verticals
• Current Trends: Strength
in NA Residential and
Food & Beverage;
Industrial has Stabilized;
Energy Mixed
Resi/Comm,
~24%
Energy,
~28%Infrastructure,
~13%
Industrial,
~26%
Food &
Beverage,
~9%
5
Valves &
Controls
~33%
Technical
Solutions,
~22%Process
Technologies
~23%
By Geography
U.S. and
Canada,
~46%Western
Europe,
~18%
Fast
Growth,
~25%
Developed
Non-U.S.,
~11%
100% = $7.5B
Flow
Technologies,
~22%
PENTAIR 2014 Electrical Products Group Conference
STRATEGY
DRIVING HIGH PERFORMANCE
A
L
I
G
N
M
E
N
T
HOW WE DIFFERENTIATE PENTAIR
• Purpose, Vision & Strategic Priorities
• Value Proposition & Competitive Advantage
• Controlling Our Destiny
HOW WE EXECUTE
• Standard Operating Model … PIMS
• Organization Design … Corporate, GBUs, Fast Growth Regions
• Functional Excellence … Standards & Practices
HOW WE WIN RIGHT
• Win Right … Pentair Values
• Leadership Behaviors … Top Talent
• How We Work Together
Three Levers … Aligned To Achieve Our Goals
PROCESS &
STRUCTURE
CULTURE &
TALENT
6
PENTAIR 2014 Electrical Products Group Conference
2013 2014 20152013 2014 20152013 2014 2015
FINANCIAL TARGETS
7
Continued Progress Toward Becoming a Great Industrial Company
Revenue ($B) Op Income EPS
~$7.7
~$8.1
+3%
~4%CAGR
+15%
~19%CAGR
$944M
~$1.3B
ROS 12.6% ~14% ~16%
$3.21
~$5.00
+22%
~25%CAGR
• Revenue Growth Accelerating
– Prioritizing Platform, Verticals, and Geographic Opportunities
• Op Income Growth & EPS Driven by Base and Synergies
– Balance Between Base (+10%) and Synergies (+8%) While Investing in
Simplification / Standardization (-3%) and Sustainable Tax Benefits
Guidance Goal Guidance Guidance GoalGoal
$7.5
~$1.1B$3.85
to $4.00
PENTAIR 2014 Electrical Products Group Conference 8
Adj. EPS Up ~13%
• Tax Rate of ~23.5%
• Net Interest ~$16.5M; Shares ~199M
Q2 Free Cash Flow Expected to be
Strong; >125% of Net Income
Q2’14 FINANCIAL OUTLOOK (YoY)
Expect Margin and EPS Growth Even With Tough Top Line Comp
Q2'14 PENTAIR OUTLOOK
Sales ~Flat to Down 1%
• Valves & Controls Flat
• Process Technologies Up ~6-8%
• Flow Technologies Down ~20%
• Technical Solutions Up ~4-6%
Adj. Op Income Up ~6% (Includes -10% From OMT & AUS Projects)
Adj. Op Margins ~14.7% … Up ~100 bps
• Valves & Controls Margins, ~14.0%
• Process Technologies Margins, ~17.5%
• Flow Technologies Margins, ~12.5%
• Technical Solutions Margins, ~20.0%
~$1.95B
~$285M
~14.7%
$1.02-$1.05
Q2’14 Q2’13Sales
Op Income (Adj.)
ROS (Adj.)
EPS (Adj.)
$1.96B
$268M
13.7%
$0.92
~($95M)
~($20M)
$M YoY %
Sales
Op Income (Adj.)
~(5%)
~(7%)
Total Pentair
Water Transport Impact
YoY %
YoY %
~(1%)
~13%
PENTAIR 2014 Electrical Products Group Conference 9
Adj. EPS Up 22%
• Tax Rate of ~23.5%
• Net Interest ~($70M); Shares ~198.5M
Free Cash Flow of ~$850M; >105% Net Income
FY’14 FINANCIAL OUTLOOK (YoY)
Current Outlook Consistent with Previous Guidance
FULL YEAR 2014 PENTAIR OUTLOOK
Sales Up ~2-4%
• Valves & Controls Up ~1-3%
• Process Technologies Up ~8-10%
• Flow Technologies Down ~5-7%
• Technical Solutions Up ~4-6%
Adj. Op Income Up ~15% (Includes $20M of OMT Investment)
Adj. Op Margins ~14.1% … Up ~150 bps
• Valves & Controls Margins, ~13.5%
• Process Technologies Margins, ~16.0%
• Flow Technologies Margins, ~11.5%
• Technical Solutions Margins, ~21.5%
Total Pentair
~$7.7B
~$1.1B
~14.1%
$3.85-$4.00
FY’14 FY’13Sales
Op Income (Adj.)
ROS (Adj.)
EPS (Adj.)
$7.48B
$944M
12.6%
$3.21
YoY %
YoY %
~3%
~22%
~($150M)
~($32M)
$M YoY %
Sales
Op Income (Adj.)
~(2%)
~(3%)
Water Transport Impact
PENTAIR 2014 Electrical Products Group Conference
2013 2014F 2015T
REVENUE GROWTH (YoY)
10
Underlying Growth Masked by Inherited Projects
+15%
(6%)
~+14%
(~6%)
~+17%
Core
Growth
5%
Core
Growth
~5%
Core
Growth
~6%
WT/Mega
(2%)WT
~(2%)
$7.5B$7.7B
$8.1B
• Water Transport & Thermal Mega Projects Impacted 2013 Growth
• Water Transport / Divestitures (Small - Non Core) Impacting 2014
• “Core” (Excluding WT) Grew +5% in 2013 and is Expected to
Grow ~5% in 2014 & ~6% in 2015
Water Transport
Expected to be
Approximately Flat to 2014
By Segment
Valves & Controls
2013 +4%
2014F +2%
2015T +6%
Flow Technologies
2013 -1%
2014F -6%
2015T +4%
Flow Tech. WT Impact
2013 -5%
2014F -9%
2015T +0%
Process Technologies
2013 +8%
2014F +9%
2015T +7%
Technical Solutions
2013 -3%
2014F +5%
2015T +8%
PENTAIR 2014 Electrical Products Group Conference
2013 2014F 2015T
OPERATING INCOME GROWTH (YoY)
11
Solid Contribution from Core / Synergies + Repositioning
Repositioning +11%
+13%
(5%)
Core /
Synergies
WT / Mega
+19%
~(7%)
~+14%
~+8%
~+15%
~+16%
~+23%
$944M ~$1.1B ~$1.3B
~+7%OMT
OMT
• Solid “Core” Performance + Repositioning / Synergies Driving Healthy
Operating Income and Margin Expansion
• Water Transport / Mega “Challenged” 2013
• Water Transport + OMT Investment Impacting 2014
• OMT Expected to “Flip” to a Positive in 2015 … Core / Synergies Accelerate
By Segment
Valves & Controls
2013 +24%
2014F* +12%
2015T +20%
Flow Technologies
2013 +7%
2014F -2%
2015T +20%
Flow Tech. WT Impact
2013 -3%
2014F -19%
2015T +0%
Process Technologies
2013 +35%
2014F +20%
2015T +20%
Technical Solutions
2013 +13%
2014F +16%
2015T +15%
*Includes OMT
PENTAIR 2014 Electrical Products Group Conference
2013 2014F 2015T
EARNINGS PER SHARE GROWTH (YoY)
12
Repositioning
Shares / Taxes
Base / Core
WT / Mega
+13%
+14%
+5%
(6%)
~+5%
~+11%
~+13%
~(7%)
~+7%
~+15%
+26%~+22%
~+27%
$3.21 ~$3.93 ~$5.00
A Solid Mix of Contribution
~+5%
PENTAIR 2014 Electrical Products Group Conference
SUSTAINED, PREDICTABLE GROWTH IS GOAL
13
Building a Growth Culture is Next Step in Evolution
• We Have a 14 Year Legacy of PIMS and Lean in the
Factory / Enterprise
• Growth Tools Within PIMS Applied 4 Years Ago …
Building Momentum
• 20 Defined “Technology / Application” Platforms Exist
Under the 5 GBU’s and 4 Reporting Segments
− Measured
− Held Accountable
− Investment in Growth Not Equal, Must be Earned
PENTAIR 2014 Electrical Products Group Conference
VALVES & CONTROLS (2013 SALES OF $2.5B)
14
Platform Focus Leads to More Disciplined Resource Allocation
VerticalKey Product Technology Platforms (4)
Quarter
Turn
Pressure
Management
Gate, Globe, &
Check
Actuation &
Controls
Geography
Energy
61%
Industrial
39%
U.S. &
Canada
25%
Fast
Growth
40%
W. Europe
24%
Oth. Developed
11%
PENTAIR 2014 Electrical Products Group Conference
PROCESS TECHNOLOGIES (2013 SALES OF $1.8B)
15
VerticalKey Product Technology Platforms (7)
Aquaculture
Hygienic
Production
Systems
Advanced
Filtration
Food
Service
O&G
Separation
Geography
Energy 3%Industrial 7%
Residential &
Commercial
58%
Infrastructure 7%
Food &
Beverage
25%
U.S. &
Canada
60%
Fast
Growth
21%
W. Europe
16%
Oth. Developed 3%
Pool Water
Purification
Platform Focus Leads to More Disciplined Resource Allocation
PENTAIR 2014 Electrical Products Group Conference
FLOW TECHNOLOGIES (2013 SALES OF $1.6B)
16
VerticalKey Product Technology Platforms (4)
Engineered
Flow
Water
Transport
Residential
Flow
Applied
Water
Geography
Energy 6%
Industrial 8%
Residential &
Commercial
34%
Infrastructure
39%
Food &
Bev.
13%
U.S. &
Canada
42%
Fast
Growth
13%
W. Europe
10%
Oth.
Developed
35%
Platform Focus Leads to More Disciplined Resource Allocation
PENTAIR 2014 Electrical Products Group Conference
TECHNICAL SOLUTIONS (2013 SALES OF $1.7B)
17
VerticalKey Product Technology Platforms (5)
Equipment
Protection
Industrial
Heat Tracing
Electronics
Thermal
Building
Solutions
Mega
Projects
Geography
Energy
25%
Industrial
46%
Resi. &
Comm.
14%
Infrastructure
13%
Food & Beverage 2%
U.S. &
Canada
63%
Fast
Growth
16%
W. Europe
19%
Oth. Developed 2%
Platform Focus Leads to More Disciplined Resource Allocation
PENTAIR 2014 Electrical Products Group Conference 18
OUR STANDARD OPERATING MODEL
Standard Operating Model Across the Enterprise
Lean Enterprise and Standardization Talent Growth
Rapid Growth Process
• Rigorous 2X Funnel‒ Market Coverage
‒ Verticals
‒ Fast Growth Regions
• Alpha Test
3D Innovation
• Discover, Develop, Deploy
Sales Excellence‒ Opportunity Segments
‒ Coverage Design
‒ Sales Process
‒ Job Design and
Organization Structure
‒ Resource Deployment
‒ Sales Talent and
Management
‒ Productivity Metrics
‒ Performance Management
and Compensation
Lean Enterprise
• ERP Management‒ Larger ERP Platforms
‒ Tax Efficient Processes
• Shared Service Centers‒ Scale Efficiency
‒ Process Excellence
• Process Digitization‒ Standard Tools
‒ Electronic Transactions
Manufacturing Excellence
• Four Wall Lean‒ Strategy Deployment
‒ Transformation Planning
‒ 5S
‒ Standard Work
‒ Creating Continuous Flow
‒ Material Flow
‒ Visual Management/MDI
• Supply Chain
Logistics Optimization
• Distribution Network
• Lead Time Reduction
Service Excellence
• Project Mgmt. Lean
• Global Work Sharing
PIMSPentair Integrated Management System
Talent Management
• Talent Acquisition
• Talent Deployment
Organization Development
• Organization Structure
• Management Processes
Pay for Performance
• Incentive Plans
• Rewards and Recognition
Win Right Values
• Customer First
• Accountability for
Performance
• Innovation
• Positive Energy
• Respect and Teamwork
• Absolute Integrity
PENTAIR 2014 Electrical Products Group Conference
“THE GROWTH PROCESS”
19
The Key to Sustainable, Predictable Growth
Detailed Assessment
Across 20 Platforms
Strategy
Technology
Innovation
3D
Market
Innovation
RGP
Core
Sales
Excellence
Growth Tree
Prior Year
+/- Acq. / Div. %
+/- FX %
+/- Market % Global Analysis
+ NPI %
+ Projects %
+ Coverage/Penetration %
Current Target
Sales Excellence
1. Opportunity Segments
2. Coverage Design
3. Sales Process
4. Job Design and Organization
Structure
5. Resource Deployment
6. Sales Talent and Management
7. Productivity Metrics
8. Performance Management and
Compensation
PIMS Tools Differentiated
Growth
2-3x Funnels
Required
Current
State
Future
State
Transformation
Plan
For Each
Platform
PENTAIR 2014 Electrical Products Group Conference
CAPITAL ALLOCATION PHILOSOPHY
Disciplined Allocation Philosophy … Prioritized Towards ROIC20
Capital Allocation Uses (Assuming ~$2.4B Cumulative FCF from ’12-’15):
1. Committed to Maintain Investment Grade Rating
2. 37 Straight Years of Dividend Increases … Disciplined Cash
Management and Return of Cash to Shareowners
3. Highest ROIC Comes From Funding Organic Growth Opportunities;
Focus on Most Attractive Growth Platforms
4. Acquisitions or Share Repurchase: We Play in Attractive Spaces
Where Opportunities are Plentiful … Bolt-on’s Focused on Channel
Expansion, Technology, and Geographies
PENTAIR 2014 Electrical Products Group Conference
2012 2013 2014F 2015T 2016+
2012 2013 2014F 2015T 2016+
2012 2013 2014F 2015T 2016+
WHAT’S NEXT AFTER 2015?
21
We are Optimistic About 2016 and Beyond
Operating IncomeRevenue
EPS
• Over $4B of Free Cash Flow Expected to
be Generated Between 2014 – 2017
• Synergies Expected to Continue
Through 2017+
• Tax Rate Expected to Approach ~20%
• Dividends and Buybacks Expected
to Continue
• New Acquisitions and/or Buyback Capacity
$7.3B $7.5B ~$7.7B ~$8.1B
~+6%$0.8B
$0.9B~$1.1B
~$1.3B
$2.54
$3.21
~$3.93
~$5.00
~+3%
+19%
+3%~+23%
~+15%
~+22%~+27%
+26%
~5%+~15%+
~15%+
Summary
PENTAIR 2014 Electrical Products Group Conference
KEY MESSAGES
• We Continue to Expect to Deliver ~$5.00 EPS by 2015
• Productivity & Synergies Solidifying
• Sustained and Predictable Growth is Goal
• We Are Optimistic About 2016 and Beyond
Delivering on Commitments One Quarter at a Time22
PENTAIR 2014 Electrical Products Group Conference 23
APPENDIXGAAP to Non-GAAP Measurements & Reconciliations
PENTAIR 2014 Electrical Products Group Conference 24
REPORTED TO ADJUSTED 2014 RECONCILIATION
Pentair Ltd. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ended December 31, 2014 to the “Adjusted” non -GAAP
excluding the effect of 2014 adjustments (Unaudited)
Actual Forecast
In millions, except per-share data First
Quarter Full
Year
Total Pentair Net sales $ 1,725.2 approx $ 7,700
Operating income—as reported 179.9 approx 1,060 % of net sales 10.4% approx 13.8%
Adjustments: Restructuring and other 22.9 approx 23
Redomicile related expenses 1.5 approx 2
Operating income—as adjusted 204.3 approx 1,085 % of net sales 11.8% approx 14.1%
Net income attributable to Pentair Ltd. —as reported 118.6 approx 754
Loss on sale of business, net of tax 6.1 approx 6
Adjustments, net of tax 20.3 approx 20
Net income attributable to Pentair Ltd. —as adjusted $ 145.0 approx $ 780
Earnings per common share attributable to Pentair Ltd. —diluted
Diluted earnings per common share —as reported $ 0.59 approx $3.71 - $3.86
Adjustments 0.14 approx 0.14
Diluted earnings per common share —as adjusted $ 0.73 approx $3.85 - $4.00
PENTAIR 2014 Electrical Products Group Conference 25
REPORTED TO ADJUSTED 2014 RECONCILIATIONPentair Ltd. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ended December 31, 2014 to the “Adjusted” non -GAAP
excluding the effect of 2014 adjustments (Unaudited)
Actual Forecast
In millions First
Quarter Full
Year
Valves & Controls
Net sales $ 534.8 approx $ 2,520
Operating income—as reported 52.2 approx 330 % of net sales 9.8% approx 13.1%
Adjustments:
Restructuring and other 9.5 approx 10
Operating income—as adjusted 61.7 approx 340 % of net sales 11.5% approx 13.5%
Process Technologies
Net sales $ 418.3 approx $ 1,925
Operating income —as reported 46.3 approx 297 % of net sales 11.1% approx 15.8%
Adjustments:
Restructuring and other 2.8 approx 3
Operating income—as adjusted 49.1 approx 300 % of net sales 11.7% approx 16.0%
Flow Technologies
Net Sales $ 364.1 approx $ 1,505
Operating income—as reported 27.5 approx 163
% of net sales 7.5% approx 10.9%
Adjustments:
Restructuring and other 8.5 approx 9
Operating income—as adjusted 36.0 approx 172
% of net sales 9.9% approx 11.5%
Technical Solutions
Net sales $ 415.3 approx $ 1,745
Operating income—as reported 76.2 approx 372 % of net sales 18.4% approx 21.3%
Adjustments:
Restructuring and other 2.9 approx 3
Operating income—as adjusted 79.1 approx 375 % of net sales 19.1% approx 21.5%
PENTAIR 2014 Electrical Products Group Conference 26
REPORTED TO ADJUSTED 2013 RECONCILIATION
Pentair Ltd. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ended December 31, 2013 to the “Adjusted” non-GAAP
excluding the effect of 2013 adjustments (Unaudited)
In millions, except per-share data First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter Full
Year
Total Pentair Net sales $ 1,774.5 $ 1,963.7 $ 1,824.8 $ 1,916.7 $ 7,479.7
Operating income—as reported 74.3 225.9 240.0 233.8 774.0 % of net sales 4.2% 11.5% 13.2% 12.2% 10.3%
Adjustments: Inventory step-up and customer backlog 76.8 10.1 — — 86.9
Restructuring and other 27.4 32.4 8.7 61.6 130.1
Pension and other post-retirement mark-to-market gain —
—
—
(63.2) (63.2)
Trade name impairment — — — 11.0 11.0
Redomicile related expenses — — — 5.4 5.4
Operating income—as adjusted 178.5 268.4 248.7 248.6 944.2 % of net sales 10.1% 13.7% 13.6% 13.0% 12.6%
Net income attributable to Pentair Ltd.—as reported 51.7 154.1 172.8 158.2 536.8
Gain on sale of businesses, net of tax (12.5) — — (2.2) (14.7)
Interest expense, net of tax — 1.6 — — 1.6
Adjustments, net of tax 80.8 33.5 1.1 18.0 133.4
Net income attributable to Pentair Ltd.—as adjusted 120.0 189.2 173.9 174.0 657.1
Earnings per common share attributable to Pentair
Ltd.—diluted
Diluted earnings per common share—as reported $ 0.25 $ 0.75 $ 0.85 $ 0.78 $ 2.62
Adjustments 0.33 0.17 0.01 0.08 0.59
Diluted earnings per common share—as adjusted $ 0.58 $ 0.92 $ 0.86 $ 0.86 $ 3.21
PENTAIR 2014 Electrical Products Group Conference 27
REPORTED TO ADJUSTED 2013 RECONCILIATIONPentair Ltd. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ended December 31, 2013 to the “Adjusted” non -GAAP
excluding the effect of 2013 adjustments (Unaudited)
In millions First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter Year
Valves & Controls
Net sales $ 585.8 $ 619.9 $ 611.5 $ 652.0 $ 2,469.2
Operating income (loss) —as reported (18.6) 56.9 76.6 46.5 161.4 % of net sales (3.2)% 9.2 % 12.5 % 7.1 % 6.5 %
Adjustments:
Restructuring and other 7.3 17.0 3.7 32.8 60.8
Inventory step-up and customer backlog 70.6 10.0 — — 80.6
Operating income—as adjusted 59.3 83.9 80.3 79.3 302.8
% of net sales 10.1 % 13.5 % 13.1 % 12.2 % 12.3 %
Process Technologies
Net sales $ 396.6 $ 477.6 $ 421.2 $ 470.5 $ 1,765.9
Operating income—as reported 43.4 76.8 57.1 65.9 243.2 % of net sales 10.9 % 16.1 % 13.6 % 14.0 % 13.7 %
Adjustments:
Restructuring and other 2.4 2.7 2.8 1.7 9.6
Inventory step-up and customer backlog 0.4 — — — 0.4
Operating income—as adjusted 46.2 79.5 59.9 67.6 253.2
% of net sales 11.6% 16.6 % 14.2 % 14.4 % 14.2 %
Flow Technologies
Net sales $ 390.6 $ 478.2 $ 397.2 $ 352.5 $ 1,618.5
Operating income—as reported 31.4 59.3 48.8 10.2 149.7 % of net sales 8.0 % 12.4 % 12.3 % 2.9 % 9.2 %
Adjustments:
Restructuring and other 5.1 3.9 0.7 14.4 24.1
Inventory step-up and customer backlog 0.2 0.2 — — 0.4
Operating income—as adjusted 36.7 63.4 49.5 24.6 174.2
% of net sales 9.4 % 13.3 % 12.5 % 7.0 % 10.8 %
Technical Solutions
Net sales $ 410.0 $ 397.4 $ 405.9 $ 450.1 $ 1,663.4
Operating income—as reported 53.3 65.1 82.2 84.4 285.0 % of net sales 13.0 % 16.4 % 20.3 % 18.8 % 17.1 %
Adjustments:
Restructuring and other 10.7 4.9 1.5 3.6 20.7
Tradename impairment — — — 11.0 11.0
Inventory step-up and customer backlog 5.7 — — — 5.7
Operating income—as adjusted 69.7 70.0 83.7 99.0 322.4 % of net sales 17.0 % 17.6 % 20.6 % 22.0 % 19.4 %
PENTAIR 2014 Electrical Products Group Conference 28
2012 PRO FORMA ADJUSTMENTS – TOTAL PENTAIRPro Forma Reconciliation
Pro Forma Adjustments
2012 Total Pentair
(in millions, except
EPS )
Historical
Adjusted
Results
Historical Flow
Control
Acquisition
Depreciation &
Amortization
Other
Adjustments
Adjusted Pro
Forma Results
First Quarter
Sales 858.2$ 995.9$ —$ (74.0)$ 1,780.1$
Operating Income 96.8 124.9 (17.1) (32.2) 172.4
Net Income 64.0 93.7 (12.8) (28.1) 116.8
Di luted EPS 0.64 0.44 (0.06) (0.48) 0.54
Second Quarter
Sales 941.5 980.8 — (33.2) 1,889.1
Operating Income 134.5 143.5 (17.2) (24.0) 236.8
Net Income 83.7 107.6 (12.9) (14.0) 164.4
Di luted EPS 0.83 0.50 (0.06) (0.50) 0.77
Third Quarter
Sales 865.5 1,019.8 — (16.0) 1,869.3
Operating Income 107.5 119.9 (17.3) 5.5 215.6
Net Income 65.5 89.9 (13.0) 6.4 148.8
Di luted EPS 0.64 0.42 (0.06) (0.31) 0.69
Fourth Quarter
Sales 1,750.9 — — (7.1) 1,743.8
Operating Income 149.7 — — 16.6 166.3
Net Income 99.7 — — 12.7 112.4
Di luted EPS 0.47 — — 0.06 0.53
Full Year
Sales 4,416.1 2,996.5 — (130.3) 7,282.3
Operating Income 488.5 388.3 (51.6) (34.1) 791.1
Net Income 312.9 291.3 (38.7) (23.1) 542.4
Di luted EPS 2.39 1.36 (0.18) (1.03) 2.54