Watts Water Technologies, Inc. · NYSE:WTS
Watts Water Technologies — Q3 2025 Earnings Presentation
19 slides from Watts Water Technologies's earnings presentation, Nov 6, 2025
Slide 1: Q3 2025 Earnings Conference Call
WATTS WATER TECHNOLOGIES Q3 2025 EARNINGS CONFERENCE CALL November 6, 2025 © 2025 Watts Water Technologies, Inc.
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements in this presentation constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are related to forecasts of sales, margins, earnings, earnings per share, effective tax rate, capital
Slide 3: Q3 Overview and 2025 Outlook
Q3 Overview and 2025 Outlook Q3 2025 Performance Business Updates 2025 Outlook Strong Q3 results exceeded Acquired Haws Corporation, a leading Increasing FY sales and margin outlook expectations brand providing emergency safety & ▲ YTD performance hydration solutions Organic sales* increased 9% driv
Slide 4: Q3 2025 Financial Summary
Q3 2025 Financial Summary Sales ($M) Adj. EBITDA and Adj. Adj. EPS ($)* FCF ($M)* Operating Margin (%)* $612 $216 $2.50 $204 20.9% $544 +13% Adj. +140 $2.03 Reported 19.5% bps EBITDA +9% 18.5% +23% +6% Organic* +140 Adj. OM bps 17.1% 2024 2025 2024 2025 2024 2025 2024 2025 • Segment sales • Adj. EBI
Slide 5: Q4 and Full Year 2025 Outlook
Q4 and Full Year 2025 Outlook* Previous FY Outlook Updated FY Outlook Q4 Outlook Reported +2% to +5% Reported +7% to +8% Reported +9% to +13% Sales Growth Organic Flat to +3% Organic +4% to +5% Organic +4% to +8% Segment Organic Growth Segment Organic Growth Segment Organic Growth Americas: +2% to +
Slide 6: Summary
Summary Better-than-expected Q3 results driven by strong Americas growth, price and volume leverage Managing tariff-related challenges through price and global supply chain strategies Raising full year 2025 sales and margin outlook due to strong Q3 results Acquired Haws Corporation, a leading brand
Slide 7: Appendix
Appendix 7 © 2025 Watts Water Technologies, Inc.
Slide 8: Other 2025 Outlook Inputs
Other 2025 Outlook* Inputs Previous Other FY Inputs Updated Other FY Inputs Other Q4 Inputs Corporate Costs ~$58M ~$61M ~$15M Net Interest Expense ~$2M - $3M ~$1M - $2M <$0.5M Stock-Based Compensation ~$20M ~$21M ~$6M Adj Effective Tax Rate ~25% 25% to 26% ~26% Share Count ~33.5M ~33.5M ~33.5M Capex
Slide 9: Watts Water Snapshot (NYSE: WTS)
Watts Water Snapshot (NYSE: WTS) 2024 Key Statistics With 5 Year Performance vs. 2019 $8.86 17.7% $1.72 $2.3B 112% 19.8% 106% Adj. EPS Adj. Operating Margin Dividends Net Sales 5-yr Avg Free Cash ROIC (GAAP) 5-yr Avg Reinvestment +17% CAGR +480 bps Expansion +13% CAGR 7% CAGR Flow Conversion +640 bp
Slide 10: Key Themes
Key Themes Recognized Aligned to Focus on Accretive Capital Resilient Leader Long-term Secular Innovation and Deployment and Business Model Trends and Profitable Growth Strong Balance Tested Across Diverse Markets Sheet Economic Cycles Global reach Solutions aligned Continuing Targeting >100% Large
Slide 11: Consolidated Statements of Operations
Consolidated Statements of Operations Third Quarter 2025 2024 B/(W) % Net sales $611.7 $543.6 $68.1 13% Cost of goods sold 313.3 286.5 (26.8) (9%) Gross profit 298.4 257.1 41.3 16% 48.8% 47.3% +150 bps Selling, general & administrative expenses 185.1 159.0 (26.1) (16%) 30.3% 29.2% -110 bps Restructu
Slide 12: Reconciliation of Net Sales to Organic Net Sales
Reconciliation of Net Sales to Organic Net Sales Third Quarter Americas Europe APMEA Total Net sales 2025 $464.1 $111.6 $36.0 $611.7 Net sales 2024 $400.0 $107.3 $36.3 $543.6 Dollar change $64.1 $4.3 ($0.3) $68.1 Net sales % increase (decrease) 16% 4% (1%) 13% Foreign exchange impact - (6%) 1% (1%)
Slide 13: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures Third Quarter Nine Months 2025 2024 2025 2024 Net Sales $611.7 $543.6 $1,813.4 $1,711.8 Operating income $111.4 $93.2 $334.4 $301.4 Operating margin % 18.2% 17.1% 18.4% 17.6% Adjustments for special items: Restructuring $1.9 $4.9 $22.6 $6.4 Acquisition-rel
Slide 14: Segment Earnings and Margin Summary
Segment Earnings and Margin Summary Third Quarter 2025 Third Quarter 2024 Americas Europe APMEA Corp. Consolidated Americas Europe APMEA Corp. Consolidated Segment earnings / Corp expenses / Adj. OI $110.0 13.6 7.0 (17.3) $113.3 $87.6 11.3 6.7 (12.8) $92.8 Segment margin / Adjusted operating margin
Slide 15: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Nine Months 2025 2024 Net cash provided by operating activities $247.3 $221.6 Less: additions to property, plant, and equipment (31.3) (23.3) Plus: proceeds from the sale of property, plant, and equipment - 5.9 Free cash f
Slide 16: Reconciliation of Long-term Debt to Net Debt to Capitalization Ratio
Reconciliation of Long-term Debt (Including Current Portion) to Net Debt to Capitalization Ratio September 28, 2025 December 31, 2024 Current portion of long-term debt $- $- Plus: Long-term debt, net of current portion 197.5 197.0 Less: Cash and cash equivalents (457.7) (386.9) Net debt ($260.2) ($1
Slide 17: Calculations of EBITDA & Gross and Net Leverage
Calculations of EBITDA & Gross and Net Leverage Third Quarter Ended Third Quarter Ended Trailing Twelve Months September 28, 2025 September 29, 2024 Ended September 28, 2025 Sales $611.7 $543.6 $2,353.8 Net income – as reported $82.2 $69.1 $324.6 Plus: Interest expense, net 0.2 1.5 1.0 Plus: Income
Slide 18: Reconciliation of Adjusted Non-GAAP Effective Tax Rate
Reconciliation of “Adjusted” Non-GAAP Effective Tax Rate Third Quarter Nine Months 2025 2024 2025 2024 Income before income taxes $111.0 $92.3 $332.6 $297.0 Provision for income taxes $28.8 $23.2 $75.5 $73.4 Effective tax rate 25.9% 25.1% 22.7% 24.7% Income before income taxes $111.0 $92.3 $332.6 $2
Slide 19: Reconciliation between GAAP and Non-GAAP Measures Included in 2025 Outlook
Reconciliation between GAAP and Non-GAAP Measures Included in 2025 Outlook* Fourth Quarter Full Year 2025 2025 Net Sales Net sales growth +10% to +13% +7% to +8% Forecasted impact of acquisition / FX -5% -3% Organic net sales growth +5% to +8% +4% to +5% Operating Margin Operating margin range 16.5%
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