Slide 1: Q4 2020 Earnings Release
Q4 2020 EARNINGS RELEASE January 28, 2021 ©2020 Pentair. All Rights Reserved. Confidential property of Pentair. Do not reproduce or distribute without express permission of Pentair. 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements CAUTION CONCERNING FORWARD - L OOKING STATEMENTS THIS PRESENTATION CONTAINS STATEMENTS THAT WE BELIEVE TO BE “FORWARD-LOOKING STATEMENTS” WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION R EFORM ACT OF 1995. ALL STATEMENTS, OTHER THAN STATEMENTS OF HISTORICAL FACT A
Slide 3: Key Definitions
Key Definitions • Except as Otherwise Noted All References to 2021, 2020 and 2019 Represent Our Results from Continuing Operations for the Period Indicated, Presented on an Adjusted Basis • "Core Sales" Refers to GAAP Revenue from Continuing Operations Excluding (1) the Impact of Currency Translatio
Slide 4: Executive Summary
Executive Summary Delivered strong full year results while facing unprecedented challenges • Sales up 2% to $3.02B; Adj. EPS up 5% to $2.50; and Free Cash Flow of $512M Stayed focused on the health and safety of our employees, customers, businesses, and communities Continued to invest in our t
Slide 5: Q4'20 Pentair Performance
Q4’20 Pentair Performance Sales Financial Highlights (YoY) $23M $4M $2M $12M $796M Core Sales up 3% $755M • Consumer Solutions up 8% 5% YoY • Industrial & Flow Technologies down 3% 2 pts 1 pt 0 pts 2 pts 5 pts Segment Income Flat (1 pt) Acq./ Q4’19 Volume Price FX Q4’20 Divestitures ROS 17.7% … down
Slide 6: FY'20 Pentair Performance
FY’20 Pentair Performance Sales Financial Highlights (YoY) Core Sales up 1% $25M $16M $5M $3.02B $2.96B $15M • Consumer Solutions up 7% 2% YoY • Industrial & Flow Technologies down 6% Segment Income Flat 0 pts 1 pt 1 pt 0 pts 2 pts (1 pt) Acq./ 2019 Volume Price FX 2020 Divestitures ROS 17.2% … down
Slide 7: Q4'20 Consumer Solutions Performance
Q4’20 Consumer Solutions Performance Sales Financial Highlights (YoY) Pool $36M $1M $2M $4M $482M $439M • Sales up 15% 10% YoY • Strong demand • Growth across all product lines 8 pts 0 pts 1 pt 1 pt 10 pts (1 pt) Acq./ Q4’19 Volume Price FX Q4’20 Divestitures Water Treatment Segment Income • Sales u
Slide 8: Q4'20 Industrial & Flow Technologies Performance
Q4’20 Industrial & Flow Technologies Performance Sales Financial Highlights (YoY) Residential & Irrigation Flow $316M $8M $314M $3M Flat • Sales up 12% ($13M) -1% • Growth across all product lines YoY (4 pts) 1 pt 0 pts 2 pts (1 pt) Commercial & Infrastructure Flow (1 (1 pt) pt) Acq./ Q4’19 Volume P
Slide 9: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow Debt Summary Debt Roll-Forward $840M* Maturity 12/31/2019 12/31/2020 Use of Cash: ($M) $604M 72% Fixed 2021 – 2029 Beginning Debt $788 $1,029 Used (Generated) Cash (295) (512) Share Repurchase 150 150 Dividends 123 127 $236M 28% Variable 2023 Acquisitions/Other 263 46 12/
Slide 10: Q1'21 and Full Year 2021 Pentair Outlook
Q1’21 and Full Year 2021 Pentair Outlook Q1’21 FY’21 Sales • Total Sales up ~7% to 12% • Total Sales up ~3% to 5% • Adjusted EPS ~$0.55 to $0.63 • Adjusted EPS ~$2.60 to $2.75 EPS (Up ~6% to 21%) (Up ~5% to 10%) • Corp. Expense ~$16M • Corp. Expense ~$65M • Net Interest/Other ~$6M to $7M • Net Inter
Slide 11: 2021 Execution Expectations
2021 Execution Expectations “Deliver the Core” Deliver • Residential businesses still strong Revenue • Commercial stabilized, but acceleration is hindered Growth • Capital intensive Industrial businesses slower to recover Deliver transformation Deliver • Manage price / cost inflation plans that we e
Slide 12: We are in the Right Space for the Future
We are in the Right Space for the Future Global Water Awareness Increasing Sustainability is Environmental Concern We Serve Large and Stable End Markets With Numerous Growth Lever Opportunities Building a Leading, Sustainable Water Treatment Company Q4 2020 Earnings Release | ©2021 Pentair 12
Slide 13: Q4 2020 Earnings Release | ©2021 Pentair
Q4 2020 Earnings Release | ©2021 Pentair
Slide 14: Appendix: GAAP to Non-GAAP Measurements & Reconciliations
APPENDIX GAAP TO NON-GAAP MEASUREMENTS & RECONCILIATIONS
Slide 15: Reported To Adjusted 2020 Reconciliation
Reported To Adjusted 2020 Reconciliation Pentair plc and Subsidiaries Reconciliation of the GAAP year ended December 31, 2020 to the non-GAAP excluding the effect of 2020 adjustments (Unaudited) First Second Third Fourth Full In millions, except per-share data Quarter Quarter Quarter Quarter Year Ne
Slide 16: Reported To Adjusted 2019 Reconciliation
Reported To Adjusted 2019 Reconciliation Pentair plc and Subsidiaries Reconciliation of the GAAP year ended December 31, 2019 to the non-GAAP excluding the effect of 2019 adjustments (Unaudited) First Second Third Fourth Full In millions, except per-share data Quarter Quarter Quarter Quarter Year Ne
Slide 17: Core Sales Growth Reconciliation
Core Sales Growth Reconciliation Pentair plc and Subsidiaries Reconciliation of Net Sales Growth to Core Net Sales Growth by Segment For the Quarter and Year Ended December 31, 2020 (Unaudited) Q4 Net Sales Growth Full Year Net Sales Growth Core Currency Acq. / Div. Total Core Currency Acq. / Div. T
Slide 18: ROIC Reconciliation
ROIC Reconciliation Fourth First Second Third Fourth Quarter Quarter Quarter Quarter Quarter Dollars in millions 2019 2020 2020 2020 2020 Return on Invested Capital (ROIC) Segment income $ 140.7 $ 111.5 $ 124.7 $ 140.5 $ 140.9 Reported effective tax rate 2.8 % 21.5 % 28.8 % 11.5 % 9.8 % Adjusted eff
Slide 19: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation Pentair plc and Subsidiaries Reconciliation of the GAAP operating activities cash flow to the non-GAAP free cash flow (Unaudited) Years ended December 31 In millions 2020 2019 Net cash provided by operating activities of continuing operations $ 574.2 $ 345.2 Capital exp
Slide 20: 2020 Adjusted EBITDA Reconciliation
2020 Adjusted EBITDA Reconciliation Pentair plc and Subsidiaries Reconciliation of Net income from continuing operations to Adjusted EBITDA for the year ended December 31, 2020 (Unaudited) In millions 2020 Net income from continuing operations $ 357.1 Adjustments: Deal-related costs and expenses 0.6
Slide 21: Reported To Adjusted 2021 Reconciliation
Reported To Adjusted 2021 Reconciliation Pentair plc and Subsidiaries Reconciliation of the GAAP year ending December 31, 2021 to the non-GAAP excluding the effect of 2021 adjustments (Unaudited) Forecast First Full In millions, except per-share data Quarter Year Net sales approx Up 7 - 12 % approx