Watts Water Technologies, Inc. · NYSE:WTS
Watts Water Technologies — Q4 2025 Earnings Presentation
22 slides from Watts Water Technologies's earnings presentation, Feb 12, 2026
Slide 1: Q4 2025 Earnings Conference Call
Q4 2025 Earnings Conference Call February 12, 2026
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: 2025 Overview and 2026 Outlook
2025 Overview and 2026 Outlook 2025 Performance Business Updates 2026 Outlook Record Q4 and FY performance Acquired Superior Boiler, a leading ▲ GDP remains positive exceeded expectations manufacturer of customized boilers ▲ Price Q4 organic sales* increased 8% Acquired Saudi Cast, ▲ Data centers an
Slide 4: Executing on Strategic Growth Initiatives: Data Centers
Executing on Strategic Growth Initiatives: Data Centers Facility Water: Air-Cooled and Liquid-Cooled ▪ Data center suite of solutions includes cooling valves, strainers, Ductile Iron Ductile Iron thermal storage tanks and drains plus traditional products Butterfly Valves Strainers ▪ Addressable mark
Slide 5: Executing on Strategic Growth Initiatives: M&A
Executing on Strategic Growth Initiatives: M&A • Added strong brands with Eight Strategic Acquisitions: Deployed ~$660M Since 2023 market leadership 2023 Enware: Leading supplier for specialty plumbing and safety equipment • Expanded market, channel used in institutional and commercial end markets i
Slide 6: Q4 2025 Financial Summary
Q4 2025 Financial Summary Adj. EBITDA and Sales ($M) Adj. Operating Margin (%)* Adj. EPS ($)* $625 $2.62 +16% 21.4% Reported $540 $2.05 +8% Adj. 19.3% +210 Organic* EBITDA bps 19.0% +28% Adj. OM 16.8% +220 bps 2024 2025 2024 2025 2024 2025 Segment sales • Adj. EBITDA: $134M, +28% • Operations: +$0.5
Slide 7: FY 2025 Financial Summary
FY 2025 Financial Summary Adj. EBITDA and Adj. Sales ($M) Operating Margin (%)* Adj. EPS ($)* FCF ($M)* $10.58 +8% $2,439 $356 Reported 21.9% $2,252 $8.86 $332 +5% Adj. 20.1% +180 Organic* EBITDA bps +19% +7% 19.6% Adj. +190 OM 17.7% bps 2024 2025 2024 2025 2024 2025 2024 2025 Segment sales • Adj. E
Slide 8: Q1 and Full Year 2026 Outlook
Q1 and Full Year 2026 Outlook* FY Outlook Q1 Outlook Sales Growth Reported +8% to +12% Reported +12% to +16% Organic +2% to +6%** Organic +4% to +8%** Segment Organic Growth Acquired: Americas ~$110M to $115M Segment Organic Growth Acquired: Americas ~$25M - $30M Americas: +3% to +7% Acquired: APMEA
Slide 9: Summary
Summary Record Q4 and full year 2025 performance including sales, operating income, EPS and free cash flow Deploying significant capital on strategic growth and productivity initiatives, including data centers and Nexa Completed five strategic acquisitions in 2025, further diversifying our portfolio
Slide 10: Appendix
Watts Water Technologies, Inc. Appendix
Slide 11: Other 2026 Outlook Inputs
Other 2026 Outlook* Inputs Other FY Inputs Other Q1 Inputs Corporate Costs ~$60M ~$13M Net Interest Expense ~$3M to $4M ~$1M Stock-Based compensation ~$22M ~$4M Adj Effective Tax Rate ~25% ~25% Share Count ~33.5M ~33.5M Capex $50M to $60M ~$15M Depreciation & Amortization ~$70M ~$18M Europe (EUR at
Slide 12: Watts Water Snapshot (NYSE: WTS)
Watts Water Snapshot (NYSE: WTS) 2025 Key Statistics With 5 Year Performance vs. 2020 $10.58 19.6% $1.99 $2.4B 100% 20.5% 103% Adj. EPS Adj. Operating Margin Dividends Net Sales 5-yr Avg Free Cash ROIC (GAAP) 5-yr Avg +22% CAGR +670 bps Expansion +17% CAGR 10% CAGR Flow Conversion +880 bps Expansion
Slide 13: 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 Global reach Diverse Markets Sheet Economic Cycles with leading Continuing market positions Solutions
Slide 14: Consolidated Statements of Operations
Consolidated Statements of Operations Fourth Quarter 2025 2024 B/(W) % Net sales $625.1 $540.4 $84.7 16% Cost of goods sold 315.9 287.7 (28.2) (10%) Gross profit 309.2 252.7 56.5 22% 49.5% 46.8% +270 bps Selling, general & administrative expenses 194.4 162.9 (31.5) (19%) 31.1% 30.1% -100 bps Restruc
Slide 15: Reconciliation of Net Sales to Organic Net Sales
Reconciliation of Net Sales to Organic Net Sales Fourth Quarter Americas Europe APMEA Total Net sales 2025 $466.6 $119.7 $38.8 $625.1 Net sales 2024 $398.0 $108.6 $33.8 $540.4 Dollar change $68.6 $11.1 $5.0 $84.7 Net sales % increase 17% 10% 15% 16% Foreign exchange impact - (9%) - (2%) Acquisition
Slide 16: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures Fourth Quarter Year 2025 2024 2025 2024 Net Sales $625.1 $540.4 $2,438.5 $2,252.2 Operating income $113.7 $89.0 $448.1 $390.4 Operating margin % 18.2% 16.5% 18.4% 17.3% Adjustments for special items: Restructuring $1.1 $0.8 $23.7 $7.2 Acquisition-related c
Slide 17: Segment Earnings and Margin Summary
Segment Earnings and Margin Summary Fourth Quarter 2025 Fourth Quarter 2024 Americas Europe APMEA Corp. Consolidated Americas Europe APMEA Corp. Consolidated Segment earnings / Corp expenses / Adj. OI $108.7 18.0 6.7 (14.7) $118.7 $86.9 11.0 5.9 (12.9) $90.9 Segment margin / Adjusted operating margi
Slide 18: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Year 2025 2024 Net cash provided by operating activities $402.0 $361.1 Less: additions to property, plant, and equipment (45.7) (35.3) Plus: proceeds from the sale of property, plant, and equipment - 5.9 Free cash flow $35
Slide 19: 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 December 31, 2025 December 31, 2024 Current portion of long-term debt $- $- Plus: Long-term debt, net of current portion 197.7 197.0 Less: Cash and cash equivalents (405.5) (386.9) Net debt ($207.8) ($18
Slide 20: Calculations of EBITDA & Gross and Net Leverage
Calculations of EBITDA & Gross and Net Leverage Fourth Quarter Ended Fourth Quarter Ended Year Ended December 31, 2025 December 31, 2024 December 31, 2025 Sales $625.1 $540.4 $2,438.5 Net income – as reported $83.7 $67.5 $340.8 Plus: Interest expense, net - - 1.0 Plus: Income taxes 29.5 21.5 105.0 P
Slide 21: Reconciliation of Adjusted Non-GAAP Effective Tax Rate
Reconciliation of “Adjusted” Non-GAAP Effective Tax Rate Fourth Quarter Year 2025 2024 2025 2024 Income before income taxes $113.2 $89.0 $445.8 $386.0 Provision for income taxes $29.5 $21.5 $105.0 $94.8 Effective tax rate 26.1% 24.2% 23.6% 24.6% Income before income taxes $113.2 $89.0 $445.8 $386.0
Slide 22: Reconciliation between GAAP and Non-GAAP Measures Included in 2026 Outlook
Reconciliation between GAAP and Non-GAAP Measures Included in 2026 Outlook* First Quarter Full Year 2026 2026 Net Sales Net sales growth +12% to +16% +8% to +12% Forecasted impact of acquisition / FX -8% -6% Organic net sales growth +4% to +8% +2% to +6% Operating Margin Operating margin range 17.6%
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