Pentair (NYSE:PNR) Q3 2025 Earnings Call October 21, 2025 09:00 AM ET Company ParticipantsSteve Tusa - Managing DirectorJohn Stauch - President and CEODamian Karas - Executive DirectorJoe Giordano - Managing DirectorNigel Coe - Managing DirectorNick Cash - Global Investment Research AssociateBob Fishman - CFODeane Dray - Managing DirectorAndrew Krill - DirectorJeff Hammond - Managing DirectorShelly Hubbard - VP of Investor RelationsAndy Kaplowitz - Managing DirectorBrian Blair - Managing Director and Equity ...

Pentair (NYSE:PNR) Q3 2025 Earnings Call October 21, 2025 09:00 AM ET Company ParticipantsSteve Tusa - Managing DirectorJohn Stauch - President and CEODamian Karas - Executive DirectorJoe Giordano - Managing DirectorNigel Coe - Managing DirectorNick Cash - Global Investment Research AssociateBob Fishman - CFODeane Dray - Managing DirectorAndrew Krill - DirectorJeff Hammond - Managing DirectorShelly Hubbard - VP of Investor RelationsAndy Kaplowitz - Managing DirectorBrian Blair - Managing Director and Equity ...

Financial Data and Key Metrics Changes - In Q3 2025, the company achieved sales growth of 3%, with adjusted operating income increasing by 10% and adjusted EPS rising by 14% to $1.24 [5][13] - Return on sales (ROS) expanded by 160 basis points to 25.7% [5][13] - The company generated record free cash flow of $719 million year to date, up 14% year over year, and increased return on invested capital (ROIC) to 16.7% from 15.2% a year ago [16][17] Business Line Data and Key Metrics Changes - Flow sales increased by 6% year over year to $394 million, with residential sales up 3%, commercial sales up 5%, and industrial sales up 10% [13][14] - Water Solutions sales declined by 6% to $273 million, with commercial sales down 6% and residential sales also down 6% [14][15] - Pool sales increased by 7% to $354 million, driven by price, volume, and the Gulfstream acquisition [15][16] Market Data and Key Metrics Changes - The company expects Flow sales to be up low single digits, Water Solutions to be down mid-single digits, and Pool sales to be up approximately 7% for the full year [18] - The company anticipates fourth quarter sales to be up approximately 3% to 4% [19] Company Strategy and Development Direction - The company is focused on transformation initiatives and has delivered approximately $56 million in transformation savings year to date, aiming for $80 million in 2025 [8][9] - The company continues to invest in growth initiatives and innovation through digital and product technology [7][8] - The acquisition of Hydrostat for $292 million is expected to enhance the commercial Flow business [5][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the execution of their strategy and increased full-year guidance, expecting adjusted EPS of approximately $4.85 to $4.90, up 12% to 13% from 2024 [6][18] - Management noted that while there are uncertainties related to tariffs and interest rates, they are optimistic about the company's performance and growth potential [49][50] Other Important Information - The company has raised its dividend for 49 consecutive years and plans to continue share repurchases [8][10] - Bob Fishman, the CFO, will be leaving the company effective March 1, 2026, with a smooth transition planned [10][11] Q&A Session Summary Question: Concerns about Pool margin productivity - Management acknowledged the tough comparison for Pool margins but expressed optimism for a rebound in Q4, highlighting investments made to drive future growth [24][25] Question: Core Water Solutions growth outlook - Management noted a slight decrease in growth expectations for core Water Solutions, attributing it to slower market conditions, particularly in the food service industry [30][31] Question: Transformation savings and future potential - Management confirmed confidence in achieving the $80 million transformation savings target and indicated ongoing opportunities for further savings [36][37] Question: Flow segment pricing and performance - Management reported strong performance across residential, commercial, and industrial segments, with price increases being maintained [39][40] Question: Hydrostat acquisition and growth potential - Management indicated that Hydrostat is expected to contribute $10 million in Q4 and projected $50 million in revenue for 2026, with cross-selling opportunities identified [64][65]

Pentair (NYSE:PNR) Q3 2025 Earnings Call October 21, 2025 09:00 AM ET Speaker0Welcome to the Pentair Third Quarter twenty twenty five Earnings Conference Call. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Please also note, today's event is being recorded. At this time, I would like to turn the floor over to Shelly Hubbard, Vice President, Investor Relations.Please go ahead.Speaker1Thank you, operator, and welcome to Pentair's thir ...