Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _________________________________________________ FORM 10-Q (Mark one) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended March 31, 2023 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-35475 _________________________________________________ ZURN ELKAY WATER SOLU ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _________________________________________________ FORM 10-K (Mark one) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to _________________________________________________ ZURN ELKAY WATER SOLUTIONS CORPORATION (Exact name of registrant as ...

Zurn Elkay Water Solutions Corporation (NYSE:ZWS) Q4 2022 Earnings Conference Call February 8, 2023 8:30 AM ET Company Participants Dave Pauli - VP of IR Todd Adams - Chairman and CEO Mark Peterson - SVP and CFO Conference Call Participants Bryan Blair - Oppenheimer Jeff Hammond - KeyBanc Capital Markets Mike Halloran - Baird Vivek Srivastava - Goldman Sachs Nathan Jones - Stifel Operator Good morning, and welcome to the Zurn Elkay Water Solutions Corporation Fourth Quarter 2022 Earnings Results Conference ...

Zurn Elkay Water Solutions Corporation (NYSE:ZWS) Q3 2022 Earnings Conference Call October 26, 2022 8:30 AM ET Company Participants Dave Pauli - VP of IR Todd Adams - Chairman and CEO Mark Peterson - SVP and CFO Conference Call Participants Bryan Blair - Oppenheimer Mike Halloran - Baird Jeff Hammond - Keybanc Capital Markets Nathan Jones - Stifel Vivek Srivastava - Goldman Sachs Brett Linzey - Mizuho Operator Good morning, and welcome to the Zurn Elkay Water Solutions Corporation Third Quarter 2022 Earning ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _________________________________________________ FORM 10-Q Table of Contents (Mark one) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended September 30, 2022 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-35475 _________________________________________________ ZURN ELKAY WATER ...

Financial Data and Key Metrics Changes - The second quarter sales increased by 17% year-over-year to $284 million, with core business growth contributing 15% and the Wade Drains acquisition accounting for 2% [15] - Adjusted EBITDA was $71 million, with an adjusted EBITDA margin of 25.1%, reflecting a 60 basis point improvement sequentially from the first quarter of 2022 [15][11] - Free cash flow for the quarter was reported at $41 million, with net debt leverage at 1.9 times [11][16] Business Line Data and Key Metrics Changes - Core sales growth was balanced across water safety and control, hygienic and environmental, and flow control product categories [15] - The company experienced significant share gains in water safety and control, with a focus on backflow prevention and pressure relief valves [19] - The hygienic and environmental sector is seeing strong demand for touch sensor products and solutions for commercial restrooms [20] Market Data and Key Metrics Changes - Over 70% of revenues are derived from institutional and commercial markets, with healthcare and education being the largest segments [22] - The Dodge Momentum Index, an indicator of non-residential construction strength, reached a 14-year high, suggesting robust market conditions despite economic uncertainties [22] Company Strategy and Development Direction - The merger with Elkay is expected to create significant operational and commercial synergies, with a target of $50 million in savings across SG&A, manufacturing, and supply chain [25][26] - The company aims to be the leading pure-play water solutions business, focusing on sustainability and water stewardship [27][28] - The integration of sales and marketing organizations is a priority to present a unified front to the marketplace [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to continue growing despite recession fears, citing a strong demand creation process [50] - The company anticipates Elkay-related sales to be between $145 million and $155 million in the third quarter, with adjusted EBITDA margins expected to expand [31] - Supply chain conditions are normalizing, with expectations for inventory reduction and improved cost environments in the second half of the year [12][13] Other Important Information - The Elkay transaction closed on July 1, 2022, and the combined results will be reported starting in the third quarter [5] - The company has implemented a common business system to enhance operational efficiency and performance [27] Q&A Session Summary Question: Can you provide insights on core growth and any outperforming end-markets? - Management noted strong order rates across all sectors, with no specific outlier, and indicated a consistent high single-digit price growth expectation [45][46] Question: What are the growth dynamics for the drinking water side versus sinks and faucets? - Management highlighted that both categories faced challenges, particularly in lead times for drinking water products, but overall growth remains meaningful [47] Question: Are there concerns about a pullback in business due to recession fears? - Management remains optimistic, citing a strong track record of growth and the potential for double-digit growth in 2023 [50] Question: What is the expected EBITDA run rate for Elkay in the second half? - Management indicated an EBITDA run rate of $85 million to $90 million for Elkay, with adjustments for backlog reductions [56][58] Question: What are the opportunities for free cash flow improvement in Elkay? - Management identified working capital management and capital intensity reduction as key areas for cash flow improvement [91] Question: How is the supply chain evolving, particularly regarding regional concentration? - Management noted a shift away from reliance on China, with plans to continue diversifying supply chain sources [99][100]

| --- | --- | --- | --- | --- | --- | |----------------------------------------|-------|-------|-------|-------|-------| | | | | | | | | Second Quarter 2022 Financial Results | | | | | | | JULY 26, 2022 | | | | | | | | | | | | | CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT Forward-Looking Statements This presentation includes "forward-looking statements" within the meaning of the federal securities laws that involve risks and uncertainties. Forward-looking statements include state ...

Part I [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Unaudited condensed consolidated financial statements, including Balance Sheets, Statements of Operations, and Cash Flows, are presented, noting the Elkay merger and PMC spin-off Condensed Consolidated Balance Sheet Highlights (Unaudited) | (in Millions) | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Total current assets | $588.4 | $474.8 | | Total assets | $1,176.3 | $1,077.7 | | **Liabilities & Equity** | | | | Total current liabilities | $241.2 | $240.4 | | Long-term debt | $531.9 | $533.9 | | Total liabilities | $946.9 | $951.3 | | Total stockholders' equity | $229.4 | $126.4 | Condensed Consolidated Statements of Operations Highlights (Unaudited) | (in Millions, except per share data) | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $284.2 | $243.7 | $523.8 | $448.9 | | Gross profit | $113.8 | $103.8 | $215.7 | $192.2 | | Income from operations | $53.5 | $37.3 | $97.4 | $61.3 | | Net income from continuing operations | $36.4 | $20.6 | $65.8 | $30.6 | | Net income attributable to Zurn Elkay | $36.4 | $73.2 | $66.6 | $123.2 | | Diluted EPS (Net income) | $0.28 | $0.59 | $0.52 | $0.99 | Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | (in Millions) | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | Cash (used for) provided by operating activities | $(12.0) | $145.0 | | Cash provided by (used for) investing activities | $35.4 | $(4.4) | | Cash used for financing activities | $(9.3) | $(5.6) | | Increase in cash, cash equivalents and restricted cash | $13.8 | $135.1 | - On July 1, 2022, subsequent to the reporting period, the company completed its merger with Elkay Manufacturing Company and changed its name to **Zurn Elkay Water Solutions Corporation**, with Elkay's results included from **Q3 2022** onwards[11](index=11&type=chunk)[28](index=28&type=chunk)[106](index=106&type=chunk) - The Process & Motion Control (PMC) business, spun-off in October 2021, is reported as discontinued operations, with the company receiving a **$35.0 million** payment in H1 2022 related to final working capital adjustments from the spin-off[30](index=30&type=chunk)[40](index=40&type=chunk)[116](index=116&type=chunk) Revenue by Customer Type and Geography (Six Months Ended June 30) | (in Millions) | 2022 | 2021 | | :--- | :--- | :--- | | **Customer Type** | | | | Institutional | $196.4 | $169.1 | | Commercial | $159.8 | $137.8 | | All other | $167.6 | $142.0 | | **Geography** | | | | United States | $477.1 | $405.2 | | Canada | $35.6 | $32.8 | | Rest of world | $11.1 | $10.9 | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 and H1 2022 financial results, highlighting growth in net sales and operating income, the Elkay merger, PMC spin-off, and non-GAAP measures for performance [Results of Operations](index=25&type=section&id=2.1%20Results%20of%20Operations) Q2 and H1 2022 saw strong year-over-year growth in net sales and operating income, driven by core sales and price realization Q2 2022 vs. Q2 2021 Performance | (in Millions) | Q2 2022 | Q2 2021 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $284.2 | $243.7 | 16.6% | | Income from operations | $53.5 | $37.3 | 43.4% | | Operating Margin | 18.8% | 15.3% | +350 bps | H1 2022 vs. H1 2021 Performance | (in Millions) | H1 2022 | H1 2021 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $523.8 | $448.9 | 16.7% | | Income from operations | $97.4 | $61.3 | 58.9% | | Operating Margin | 18.6% | 13.7% | +490 bps | - Core sales, excluding acquisitions and currency effects, increased by **15%** year-over-year for both the three and six-month periods, with growth across nearly all product categories[119](index=119&type=chunk)[127](index=127&type=chunk) - Interest expense **decreased significantly** year-over-year due to lower outstanding debt following the PMC Spin-Off Transaction refinancing[122](index=122&type=chunk)[129](index=129&type=chunk) [Non-GAAP Financial Measures and Covenant Compliance](index=28&type=section&id=2.2%20Non-GAAP%20Financial%20Measures%20and%20Covenant%20Compliance) Non-GAAP measures like Adjusted EBITDA are used for performance and debt covenant compliance, with a **2.08:1** net leverage ratio well within the **5.00:1** maximum Reconciliation to Adjusted EBITDA (Trailing Twelve Months) | (in Millions) | Twelve months ended June 30, 2022 | | :--- | :--- | | Net income attributable to Zurn Elkay common stockholders | $64.3 | | Adjustments (Discontinued ops, taxes, interest, D&A, etc.) | $148.0 | | Pro forma adjustment for acquisitions | $0.5 | | **Pro forma Adjusted EBITDA** | **$212.8** | - As of June 30, 2022, the company's total net leverage ratio was **2.08 to 1.00**, **comfortably in compliance** with the credit agreement's maximum covenant of **5.00 to 1.00**[138](index=138&type=chunk)[147](index=147&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=2.3%20Liquidity%20and%20Capital%20Resources) Primary liquidity sources include cash, operating cash flow, and a revolving credit facility, with **$110.4 million** cash and **$193.9 million** available borrowing capacity, despite negative H1 2022 operating cash flow - As of June 30, 2022, the company had **$110.4 million** of cash and cash equivalents and **$193.9 million** of additional borrowing capacity under its revolving credit facility[149](index=149&type=chunk) - Cash used for operating activities was **$12.0 million** for the six months ended June 30, 2022, a **significant decrease** from the **$145.0 million** provided in the prior-year period, mainly due to higher trade working capital investment[152](index=152&type=chunk) - Cash provided by investing activities was **$35.4 million**, primarily due to the receipt of **$35.0 million** related to the finalization of the PMC spin-off transaction[153](index=153&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company discloses exposure to market risks from foreign currency and interest rate changes, managed through operating activities and derivative instruments - The company is exposed to **market risk** from changes in **foreign currency exchange rates** and **interest rates**[157](index=157&type=chunk) - Management uses **operating activities** and sometimes **derivative instruments**, such as **foreign currency forward contracts**, to manage these risks[157](index=157&type=chunk) [Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including CEO and CFO, concluded disclosure controls and procedures were effective as of June 30, 2022, with no material changes to internal controls - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2022[159](index=159&type=chunk) - There were **no changes** in internal control over financial reporting during the last fiscal quarter that have **materially affected**, or are reasonably likely to materially affect, internal controls[161](index=161&type=chunk) Part II [Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company details legal proceedings, including ordinary course litigation and asbestos claims, with established reserves and believed adequate insurance coverage - The company is involved in **various legal actions** in the ordinary course of business, for which it establishes **accruals** when liability is **probable and reasonably estimable**[95](index=95&type=chunk)[164](index=164&type=chunk) - As of June 30, 2022, the company faces approximately **6,000 asbestos-related lawsuits**, with an estimated potential liability of **$66.0 million**, which is **fully reserved for** and **matched by a corresponding insurance receivable**, as management believes the liability is **covered by insurance**[96](index=96&type=chunk)[98](index=98&type=chunk)[100](index=100&type=chunk) [Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) Updated risk factors focus on the Elkay merger, including integration challenges, expanded operations, goodwill impairment, and potential stock price depression from former Elkay stockholder sales - The company may be **unable to successfully integrate** Elkay's business and realize anticipated benefits and cost savings due to **challenges in combining operations, personnel, and systems**[167](index=167&type=chunk) - The merger will result in **significant goodwill and intangible assets** on the balance sheet, which could become **impaired** in the future, leading to **material non-cash charges** to earnings[165](index=165&type=chunk)[166](index=166&type=chunk) - Sales of stock by former Elkay shareholders, who received approximately **51.6 million shares** and own about **29%** of the combined company, could **adversely affect the trading price** of Zurn Elkay's common stock[106](index=106&type=chunk)[172](index=172&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) An update on the stock repurchase program indicates no shares were repurchased in Q2 2022, with **$162.8 million** remaining authorized for future repurchases - The company **did not repurchase any** of its common stock during the three months ended June 30, 2022[175](index=175&type=chunk) - As of June 30, 2022, approximately **$162.8 million** of the existing authority remained under the company's share repurchase program[67](index=67&type=chunk)[175](index=175&type=chunk) [Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the 10-Q report, including corporate documents, CEO/CFO certifications, and XBRL data files - Key exhibits filed include the **Amended and Restated Certificate of Incorporation and Bylaws**, **CEO and CFO certifications** under Section 302 of the Sarbanes-Oxley Act, and **Inline XBRL documents**[177](index=177&type=chunk)

ER SOLUTIONS First Quarter 2022 Financial Results April 27, 2022 CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT 2 Forward-Looking Statements This presentation includes "forward-looking statements" within the meaning of the federal securities laws that involve risks and uncertainties. Forward-looking statements include statements we make concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs and other ...

Zurn Water Solutions Corporation (NYSE:ZWS) Q1 2022 Earnings Conference Call April 27, 2022 8:30 AM ET Company Participants Todd Adams – Chairman and Chief Executive Officer Mark Peterson – Senior Vice President and Chief Financial Officer Dave Pauli – Vice President of Investor Relations Conference Call Participants Jeff Hammond – Keybanc Capital Markets Bryan Blair – Oppenheimer Joe Ritchie – Goldman Sachs Brett Linzey – Mizuho Operator Good morning and welcome to Zurn Water Solutions Corporation, First Q ...