- Sales of $1.1 billion, up 2 percent compared to sales for the
same period last year.
- Operating income increased 9 percent to $209 million reflecting
ROS of 19.3 percent, an increase of 140 basis points when compared
to second quarter of 2022; on an adjusted basis, ROS expanded 230
basis points to 21.6 percent.
- GAAP EPS from continuing operations increased 1 percent to
$0.93 compared to the same period last year and adjusted EPS rose 1
percent to $1.03 compared to the same period last year.
- Net cash provided by operating activities of continuing
operations was $447 million, an increase of $139 million compared
to the same period last year and free cash flow provided by
continuing operations for the quarter was $433 million, an increase
of $144 million compared to the same period last year.
- The company increases its full year 2023 GAAP EPS guidance to
approximately $3.27 to $3.37 and on an adjusted basis to
approximately $3.65 to $3.75.
Reconciliations of GAAP to Non-GAAP measures are in the attached
financial tables.
Pentair plc (NYSE: PNR), a leader in helping the world
sustainably move, improve and enjoy water, life’s most essential
resource, today announced second quarter 2023 sales of $1.1
billion. Sales were up 2 percent compared to sales for the same
period last year. Excluding currency translation, acquisitions and
divestitures, core sales declined 7 percent in the second quarter.
Second quarter 2023 earnings per diluted share from continuing
operations (“EPS”) were $0.93 compared to $0.92 in the second
quarter of 2022. On an adjusted basis, the company reported second
quarter 2023 EPS of $1.03 compared to $1.02 in the second quarter
of 2022. Segment income, adjusted net income, free cash flow and
adjusted EPS are described in the attached schedules.
John L. Stauch, Pentair’s President and Chief Executive Officer
commented: “Our diversified water portfolio delivered another
strong quarter with margin expansion across all three segments.
Second quarter results exceeded our expectations resulting in an
increase to our full year EPS guidance. Growth in our Industrial
and Flow Technologies and Water Solutions segments more than offset
expected volume declines in our Pool segment. Additionally,
Transformation initiatives continued to drive greater efficiencies
across all three segments through pricing and sourcing while cost
actions to right-size for lower Pool volumes also contributed to
expanded margin.”
“We remain confident that our strategy and resilient portfolio
are driving sustainable growth, profitability and strong free cash
flow. In the second quarter, we generated free cash flow of $433
million and significantly paid down debt. We are equally as excited
about the Transformation initiatives that have taken hold this year
with the compounding effects as each new wave within pricing,
sourcing, operational excellence and organizational effectiveness
is implemented. We are also encouraged by our innovation pipeline
and how we can Make Better Essential through our products and
solutions, for people and our planet by helping our customers move,
improve and enjoy water.”
Second quarter 2023 operating income was $209 million, up 9
percent compared to operating income for the second quarter of
2022, and return on sales (“ROS”) was 19.3 percent, an increase of
140 basis points when compared to the second quarter of 2022. On an
adjusted basis, the company reported segment income of $234 million
for the second quarter of 2023, up 14 percent compared to segment
income for the second quarter of 2022, and ROS was 21.6 percent, an
increase of 230 basis points when compared to the second quarter of
2022.
Industrial & Flow Technologies sales were up 9 percent
compared to sales for the same period last year. Excluding currency
translation, acquisitions and divestitures, core sales grew 9
percent in the second quarter. Segment income of $75 million was up
27 percent compared to the second quarter of 2022, and ROS was 18.2
percent, an increase of 250 basis points when compared to the
second quarter of 2022.
Water Solutions sales were up 51 percent compared to sales for
the same period last year. Excluding currency translation,
acquisitions and divestitures, core sales grew 9 percent in the
second quarter. Segment income of $75 million was up 130 percent
compared to the second quarter of 2022, and ROS was 22.2 percent,
an increase of 760 basis points when compared to the second quarter
of 2022.
Pool sales were down 28 percent compared to sales for the same
period last year. Excluding currency translation, acquisitions and
divestitures, core sales declined 28 percent in the second quarter.
Segment income of $105 million was down 23 percent compared to the
second quarter of 2022, and ROS was 31.4 percent, an increase of
190 basis points when compared to the second quarter of 2022.
Net cash provided by operating activities of continuing
operations was $447 million for the quarter compared to $308
million in the second quarter of 2022 and free cash flow provided
by continuing operations for the quarter was $433 million compared
to $288 million in the second quarter of 2022.
Pentair paid a regular cash dividend of $0.22 per share in the
second quarter of 2023. Pentair previously announced on May 8, 2023
that it will pay a regular quarterly cash dividend of $0.22 per
share on August 4, 2023 to shareholders of record at the close of
business on July 21, 2023. This year marks the 47th consecutive
year that Pentair has increased its dividend.
OUTLOOK
Mr. Stauch concluded, “We are increasing our EPS guidance
reflecting a strong first half of 2023 driven by the
diversification of our smart, sustainable water business and
long-term strategy while recognizing that we continue to operate in
a challenging macroeconomic environment with higher interest rates
and inflation. While we continue to expect 2023 to be a softer year
for our Pool sales due to lower demand in new pools and channel
inventory correction, we believe the power of our diversified
portfolio demonstrates that we can drive sustained growth and
profitability. We believe Pool remains a very attractive segment
led by migration to sunbelt states, automation of existing pools
and energy efficient and more sustainable product offerings. I
would also like to add that we are very proud of our Pentair team
who has demonstrated resilience and fortitude to continuously
deliver for our customers and shareholders throughout very unusual
operating conditions.”
The company increases its estimated 2023 GAAP EPS from
continuing operations to approximately $3.27 to $3.37 and on an
adjusted EPS basis to approximately $3.65 to $3.75. The company
maintained full year 2023 sales guidance to be down approximately 2
percent to flat on a reported basis. The company expects full year
free cash flow to approximate 100 percent of net income.
In addition, the company introduces third quarter 2023 GAAP EPS
from continuing operations guidance of approximately $0.77 to $0.82
and on an adjusted EPS basis of approximately $0.84 to $0.89. The
company expects third quarter sales to be down approximately 7
percent on a reported basis compared to the third quarter of
2022.
EARNINGS CONFERENCE CALL
Pentair President and Chief Executive Officer John L. Stauch and
Chief Financial Officer Robert P. Fishman will discuss the
company’s second quarter 2023 results on a conference call with
investors at 9:00 a.m. Eastern today. A live audio webcast of the
call, along with the related presentation, can be accessed in the
Investor Relations section of the Company’s website,
www.pentair.com, shortly before the call begins.
Reconciliations of non-GAAP financial measures are set forth in
the attachments to this release and in the presentations, each of
which can be found on Pentair’s website. The webcast and
presentations will be archived at the Company’s website following
the conclusion of the event.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This release contains statements that we believe to be
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements, other
than statements of historical fact, are forward-looking statements.
Without limitation, any statements preceded or followed by or that
include the words “targets,” “plans,” “believes,” “expects,”
“intends,” “will,” “likely,” “may,” “anticipates,” “estimates,”
“projects,” “should,” “would,” “could,” “positioned,” “strategy,”
or “future” or words, phrases, or terms of similar substance or the
negative thereof are forward-looking statements. These
forward-looking statements are not guarantees of future performance
and are subject to risks, uncertainties, assumptions and other
factors, some of which are beyond our control, which could cause
actual results to differ materially from those expressed or implied
by such forward-looking statements. These factors include the
overall global economic and business conditions impacting our
business, including the strength of housing and related markets and
conditions relating to the conflict between Russia and Ukraine and
related sanctions; supply, demand, logistics, competition and
pricing pressures related to and in the markets we serve; the
ability to achieve the benefits of our restructuring plans, cost
reduction initiatives and Transformation Program; the impact of raw
material, logistics and labor costs and other inflation; volatility
in currency exchange rates and interest rates; failure of markets
to accept new product introductions and enhancements; the ability
to successfully identify, finance, complete and integrate
acquisitions; risks associated with operating foreign businesses;
the impact of seasonality of sales and weather conditions; our
ability to comply with laws and regulations; the impact of changes
in laws, regulations and administrative policy, including those
that limit U.S. tax benefits or impact trade agreements and
tariffs; the outcome of litigation and governmental proceedings;
and the ability to achieve our long-term strategic operating and
ESG goals. Additional information concerning these and other
factors is contained in our filings with the U.S. Securities and
Exchange Commission (the “SEC”), including our Annual Report on
Form 10-K for the year ended December 31, 2022. All forward-looking
statements, including all financial forecasts, speak only as of the
date of this release. Pentair assumes no obligation, and disclaims
any obligation, to update the information contained in this
release.
ABOUT PENTAIR PLC
At Pentair, we help the world sustainably move, improve, and
enjoy water, life’s most essential resource. From our residential
and commercial water solutions, to industrial water management and
everything in between, Pentair is focused on smart, sustainable
water solutions that help our planet and people thrive.
Pentair had revenue in 2022 of approximately $4.1 billion, and
trades under the ticker symbol PNR. With approximately 11,250
global employees serving customers in more than 150 countries, we
work to help improve lives and the environment around the world. To
learn more, visit www.pentair.com.
Pentair plc and
Subsidiaries
Condensed Consolidated
Statements of Operations (Unaudited)
Three months ended
Six months ended
In millions, except per-share data
June 30,
2023
June 30,
2022
June 30,
2023
June 30,
2022
Net sales
$
1,082.5
$
1,064.2
$
2,111.1
$
2,063.8
Cost of goods sold
683.0
704.7
1,329.8
1,372.1
Gross profit
399.5
359.5
781.3
691.7
% of net sales
36.9
%
33.8
%
37.0
%
33.5
%
Selling, general and administrative
expenses
165.1
145.6
338.4
309.7
% of net sales
15.3
%
13.7
%
16.0
%
15.0
%
Research and development expenses
25.9
23.1
50.8
45.4
% of net sales
2.4
%
2.2
%
2.4
%
2.2
%
Operating income
208.5
190.8
392.1
336.6
% of net sales
19.3
%
17.9
%
18.6
%
16.3
%
Other (income) expense
Other (income) expense
(4.8
)
0.1
(4.1
)
0.2
Net interest expense
31.8
9.2
64.2
14.9
% of net sales
2.9
%
0.9
%
3.0
%
0.7
%
Income from continuing operations before
income taxes
181.5
181.5
332.0
321.5
Provision for income taxes
27.3
28.5
49.3
50.0
Effective tax rate
15.0
%
15.7
%
14.8
%
15.6
%
Net income from continuing
operations
154.2
153.0
282.7
271.5
Loss from discontinued operations, net of
tax
(1.3
)
(0.1
)
(0.1
)
(1.0
)
Net income
$
152.9
$
152.9
$
282.6
$
270.5
Earnings (loss) per ordinary
share
Basic
Continuing operations
$
0.94
$
0.93
$
1.71
$
1.65
Discontinued operations
(0.01
)
—
—
(0.01
)
Basic earnings per ordinary share
$
0.93
$
0.93
$
1.71
$
1.64
Diluted
Continuing operations
$
0.93
$
0.92
$
1.70
$
1.64
Discontinued operations
(0.01
)
—
—
(0.01
)
Diluted earnings per ordinary share
$
0.92
$
0.92
$
1.70
$
1.63
Weighted average ordinary shares
outstanding
Basic
165.0
164.8
164.9
165.0
Diluted
166.1
165.5
165.9
166.0
Cash dividends paid per ordinary
share
$
0.22
$
0.21
$
0.44
$
0.42
Pentair plc and
Subsidiaries
Condensed Consolidated Balance
Sheets (Unaudited)
June 30,
2023
December 31,
2022
In millions
Assets
Current assets
Cash and cash equivalents
$
141.6
$
108.9
Accounts and notes receivable, net
527.2
531.5
Inventories
753.9
790.0
Other current assets
147.3
128.1
Total current assets
1,570.0
1,558.5
Property, plant and equipment,
net
349.9
344.5
Other assets
Goodwill
3,265.5
3,252.6
Intangibles, net
1,068.4
1,094.6
Other non-current assets
254.5
197.3
Total other assets
4,588.4
4,544.5
Total assets
$
6,508.3
$
6,447.5
Liabilities and Equity
Current liabilities
Accounts payable
$
329.7
$
355.0
Employee compensation and benefits
106.1
106.0
Other current liabilities
624.8
602.1
Total current liabilities
1,060.6
1,063.1
Other liabilities
Long-term debt
2,114.7
2,317.3
Pension and other post-retirement
compensation and benefits
69.8
70.8
Deferred tax liabilities
41.8
43.3
Other non-current liabilities
286.1
244.9
Total liabilities
3,573.0
3,739.4
Equity
2,935.3
2,708.1
Total liabilities and equity
$
6,508.3
$
6,447.5
Pentair plc and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows (Unaudited)
Six months ended
In millions
June 30,
2023
June 30,
2022
Operating activities
Net income
$
282.6
$
270.5
Loss from discontinued operations, net of
tax
0.1
1.0
Adjustments to reconcile net income
from continuing operations to net cash provided by (used for)
operating activities
Equity income of unconsolidated
subsidiaries
(0.8
)
(0.9
)
Depreciation
29.4
26.5
Amortization
27.7
12.9
Deferred income taxes
(31.9
)
(16.9
)
Share-based compensation
14.1
13.2
Asset impairment and write-offs
4.4
—
Amortization of bridge financing fees
—
7.7
Gain on sale of assets
(3.4
)
(2.3
)
Changes in assets and liabilities, net
of effects of business acquisitions
Accounts receivable
7.4
31.4
Inventories
33.6
(144.1
)
Other current assets
(16.7
)
(31.7
)
Accounts payable
(25.8
)
(10.0
)
Employee compensation and benefits
(1.2
)
(35.7
)
Other current liabilities
22.1
60.4
Other non-current assets and
liabilities
(1.5
)
(5.7
)
Net cash provided by operating activities
of continuing operations
340.1
176.3
Net cash used for operating activities of
discontinued operations
(1.6
)
(1.0
)
Net cash provided by operating
activities
338.5
175.3
Investing activities
Capital expenditures
(35.4
)
(40.1
)
Proceeds from sale of property and
equipment
5.0
2.9
Settlement of net investment hedges
—
8.8
Acquisitions, net of cash acquired
0.2
(1.4
)
Other
4.1
—
Net cash used for investing activities
(26.1
)
(29.8
)
Financing activities
Net (repayments) borrowings of revolving
long-term debt
(204.3
)
19.8
Debt issuance costs
—
(8.9
)
Shares issued to employees, net of shares
withheld
0.8
(5.4
)
Repurchases of ordinary shares
—
(50.0
)
Dividends paid
(72.5
)
(69.5
)
Receipts upon the maturity of cross
currency swaps
—
0.2
Net cash used for financing activities
(276.0
)
(113.8
)
Effect of exchange rate changes on cash
and cash equivalents
(3.7
)
8.9
Change in cash and cash
equivalents
32.7
40.6
Cash and cash equivalents, beginning of
period
108.9
94.5
Cash and cash equivalents, end of
period
$
141.6
$
135.1
Pentair plc and
Subsidiaries
Reconciliation of the GAAP
Operating Activities Cash Flow to the Non-GAAP Free Cash Flow
(Unaudited)
Three months
ended
Three months
ended
Six months
ended
In millions
March 31,
2023
June 30,
2023
June 30,
2023
Net cash (used for) provided by operating
activities of continuing operations
$
(106.6
)
$
446.7
$
340.1
Capital expenditures
(16.6
)
(18.8
)
(35.4
)
Proceeds from sale of property and
equipment
0.2
4.8
5.0
Free cash flow from continuing
operations
(123.0
)
432.7
309.7
Net cash used for discontinued
operations
—
(1.6
)
(1.6
)
Free cash flow
$
(123.0
)
$
431.1
$
308.1
Three months
ended
Three months
ended
Six months
ended
In millions
March 31,
2022
June 30,
2022
June 30,
2022
Net cash (used for) provided by operating
activities of continuing operations
$
(131.5
)
$
307.8
$
176.3
Capital expenditures
(17.7
)
(22.4
)
(40.1
)
Proceeds from sale of property and
equipment
—
2.9
2.9
Free cash flow from continuing
operations
(149.2
)
288.3
139.1
Net cash used for discontinued
operations
—
(1.0
)
(1.0
)
Free cash flow
$
(149.2
)
$
287.3
$
138.1
Pentair plc and
Subsidiaries
Supplemental Financial
Information by Reportable Segment (Unaudited)
2023
2022
In millions
First
Quarter
Second
Quarter
Six
Months
First
Quarter
Second
Quarter
Six
Months
Net sales
Industrial & Flow Technologies
$
391.8
$
411.6
$
803.4
$
358.1
$
377.4
$
735.5
Water Solutions
272.0
336.2
608.2
205.8
222.2
428.0
Pool
364.3
334.3
698.6
435.4
464.0
899.4
Other
0.5
0.4
0.9
0.3
0.6
0.9
Consolidated
$
1,028.6
$
1,082.5
$
2,111.1
$
999.6
$
1,064.2
$
2,063.8
Segment income (loss)
Industrial & Flow Technologies
$
65.0
$
74.8
$
139.8
$
52.2
$
59.1
$
111.3
Water Solutions
52.4
74.8
127.2
22.2
32.5
54.7
Pool
116.2
105.1
221.3
116.3
136.7
253.0
Other
(22.6
)
(20.5
)
(43.1
)
(18.6
)
(22.4
)
(41.0
)
Consolidated
$
211.0
$
234.2
$
445.2
$
172.1
$
205.9
$
378.0
Return on sales
Industrial & Flow Technologies
16.6
%
18.2
%
17.4
%
14.6
%
15.7
%
15.1
%
Water Solutions
19.3
%
22.2
%
20.9
%
10.8
%
14.6
%
12.8
%
Pool
31.9
%
31.4
%
31.7
%
26.7
%
29.5
%
28.1
%
Consolidated
20.5
%
21.6
%
21.1
%
17.2
%
19.3
%
18.3
%
Pentair plc and
Subsidiaries
Reconciliation of GAAP to
Non-GAAP Financial Measures for the Year Ending December 31,
2023
Excluding the Effect of
Adjustments (Unaudited)
Actual
Forecast
In millions, except per-share data
First
Quarter
Second
Quarter
Third
Quarter
Full
Year
Net sales
$
1,028.6
$
1,082.5
approx
Down 7%
approx
Down 2% - Flat
Operating income
183.6
208.5
approx
Up 22% - 29%
approx
Up 28% - 31%
% of net sales
17.8
%
19.3
%
Adjustments:
Restructuring and other
2.9
0.6
approx
—
approx
4
Transformation costs
8.5
6.0
approx
—
approx
15
Intangible amortization
13.8
13.9
approx
14
approx
55
Legal accrual adjustments and
settlements
(1.9
)
4.1
approx
—
approx
2
Asset impairment and write-offs
3.9
0.5
approx
—
approx
4
Equity income of unconsolidated
subsidiaries
0.2
0.6
approx
1
approx
3
Segment income
211.0
234.2
approx
Down 1% - 6%
approx
Up 10% - 12%
Return on sales
20.5
%
21.6
%
Net income from continuing operations—as
reported
128.5
154.2
approx
$127 - $135
approx
$541 - $558
Other income
—
(5.1
)
approx
—
approx
$
(5
)
Adjustments to operating income
27.2
25.1
approx
14
approx
80
Income tax adjustments
(4.6
)
(3.1
)
approx
(2
)
approx
(12
)
Net income from continuing operations—as
adjusted
$
151.1
$
171.1
approx
$139 - $147
approx
$604 - $621
Continuing earnings per ordinary
share—diluted
Diluted earnings per ordinary share—as
reported
$
0.78
$
0.93
approx
$0.77 - $0.82
approx
$3.27 - $3.37
Adjustments
0.13
0.10
approx
0.07
approx
0.38
Diluted earnings per ordinary share—as
adjusted
$
0.91
$
1.03
approx
$0.84 - $0.89
approx
$3.65 - $3.75
Pentair plc and
Subsidiaries
Reconciliation of GAAP to
Non-GAAP Financial Measures for the Year Ended December 31,
2022
Excluding the Effect of
Adjustments (Unaudited)
In millions, except per-share data
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Full
Year
Net sales
$
999.6
$
1,064.2
$
1,055.1
$
1,002.9
$
4,121.8
Operating income
145.8
190.8
147.1
111.6
595.3
% of net sales
14.6
%
17.9
%
13.9
%
11.1
%
14.4
%
Adjustments:
Restructuring and other
2.1
1.1
12.5
16.7
32.4
Transformation costs
5.5
5.2
10.1
6.4
27.2
Intangible amortization
6.6
6.3
18.5
21.1
52.5
Legal accrual adjustments and
settlements
(0.7
)
0.5
—
0.4
0.2
Asset impairment and write-offs
—
—
—
25.6
25.6
Inventory step-up
—
—
5.8
—
5.8
Deal-related costs and expenses
6.4
1.6
13.4
0.8
22.2
Russia business exit impact
5.9
—
(0.8
)
(0.4
)
4.7
Equity income of unconsolidated
subsidiaries
0.5
0.4
0.3
0.6
1.8
Segment income
172.1
205.9
206.9
182.8
767.7
Return on sales
17.2
%
19.3
%
19.6
%
18.2
%
18.6
%
Net income from continuing operations—as
reported
118.5
153.0
115.4
96.3
483.2
Gain on sale of businesses
—
—
(0.2
)
—
(0.2
)
Pension and other post retirement
mark-to-market gain
—
—
—
(17.5
)
(17.5
)
Amortization of bridge financing fees
2.6
5.1
1.3
—
9.0
Adjustments to operating income
25.8
14.7
59.5
70.6
170.6
Income tax adjustments
(5.4
)
(3.8
)
(12.3
)
(14.4
)
(35.9
)
Net income from continuing operations—as
adjusted
$
141.5
$
169.0
$
163.7
$
135.0
$
609.2
Continuing earnings per ordinary
share—diluted
Diluted earnings per ordinary share—as
reported
$
0.71
$
0.92
$
0.70
$
0.58
$
2.92
Adjustments
0.14
0.10
0.29
0.24
0.76
Diluted earnings per ordinary share—as
adjusted
$
0.85
$
1.02
$
0.99
$
0.82
$
3.68
Pentair plc and
Subsidiaries
Reconciliation of Net Sales
Growth to Core Net Sales Growth by Segment
For the Quarter Ended June 30,
2023 (Unaudited)
Q2 Net Sales Growth
Core
Currency
Acq. / Div.
Total
Total Pentair
(7.0
)%
(0.2
)%
8.9
%
1.7
%
Industrial & Flow Technologies
9.1
%
—
%
—
%
9.1
%
Water Solutions
9.2
%
(0.5
)%
42.6
%
51.3
%
Pool
(27.9
)%
(0.1
)%
—
%
(28.0
)%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230727219294/en/
Shelly Hubbard Vice President, Investor Relations Direct:
763-656-5575 Email: shelly.hubbard@pentair.com
Rebecca Osborn Senior Manager, External Communications Direct:
763-656-5589 Email: rebecca.osborn@pentair.com
Pentair (NYSE:PNR)
Gráfica de Acción Histórica
De Abr 2024 a May 2024
Pentair (NYSE:PNR)
Gráfica de Acción Histórica
De May 2023 a May 2024