UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 21, 2015
Commission file number 001-11625
Pentair plc
(Exact name of Registrant as specified in its charter)
|
| | |
| | |
Ireland | | 98-1141328
|
(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification number) |
P.O. Box 471, Sharp Street, Walkden, Manchester, M28 8BU United Kingdom
(Address of principal executive offices)
Registrant’s telephone number, including area code: 44-161-703-1885
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
|
| |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
| |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
| |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
| |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
ITEM 2.02 Results of Operations and Financial Condition
On July 21, 2015, Pentair plc (the “Company”) issued a press release announcing its earnings for the second quarter of 2015 and a conference call in connection therewith. A copy of the release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
This press release refers to certain non-GAAP financial measures (core sales, adjusted operating income, adjusted operating margins, adjusted earnings per share from continuing operations and free cash flow) and a reconciliation of those non-GAAP financial measures to the corresponding financial measures contained in the Company’s financial statements prepared in accordance with generally accepted accounting principles.
The 2015 adjusted operating income, adjusted operating margins and adjusted earnings per share from continuing operations ("EPS") eliminate certain targeted restructuring activities and acquisition-related expenses. The 2014 adjusted operating income, adjusted operating margins and adjusted EPS eliminate certain targeted restructuring activities, certain expenses related to the redomicile of the Company, "mark-to-market" loss for pension and other post-retirement plans and certain tax items. Beginning this quarter, we will exclude non-cash amortization from adjusted EPS guidance to better reflect the Company's performance.
We use the term “core sales” to refer to GAAP net sales excluding 1) the impact of currency translation and 2) the impact of revenue from acquired businesses recorded prior to the first anniversary of the acquisition less the amount of sales attributable to divested product lines not considered discontinued operations (“acquisition sales”). The portion of GAAP net sales attributable to currency translation is calculated as the difference between (a) the period-to-period change in net sales (excluding acquisition sales) and (b) the period-to-period change in net sales (excluding acquisition sales) after applying current period foreign exchange rates to the prior year period. We use the term “core sales growth” to refer to the measure of comparing current period core sales with the corresponding period of the prior year. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.
Management utilizes these adjusted financial measures to assess the run-rate of its continuing operations against those of prior periods without the distortion of these factors. The Company believes that these non-GAAP financial measures will be useful to investors as well to assess the continuing strength of the Company’s underlying operations.
The Company uses free cash flow to assess its cash flow performance. The Company believes free cash flow is an important measure of operating performance because it provides the Company and its investors a measurement of cash generated from continuing operations that is available to pay dividends and repay debt. In addition, free cash flow is used as criterion to measure and pay compensation-based incentives. The Company’s measure of free cash flow may not be comparable to similarly titled measures reported by other companies.
ITEM 9.01 Financial Statements and Exhibits
| |
(a) | Financial Statements of Businesses Acquired |
Not applicable.
| |
(b) | Pro Forma Financial Information |
Not applicable.
| |
(c) | Shell Company Transactions |
Not applicable
The following exhibit is provided as part of the information furnished under Item 2.02 of this Current Report on Form 8-K:
|
| | |
Exhibit | | Description |
99.1 | | Pentair plc press release dated July 21, 2015 announcing earnings results for the second quarter of 2015. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on July 21, 2015.
|
| | |
| PENTAIR PLC |
| Registrant |
| | |
| By | /s/ John L. Stauch |
| | John L. Stauch |
| | Executive Vice President and Chief Financial Officer |
PENTAIR PLC
Exhibit Index to Current Report on Form 8-K
Dated July 21, 2015
|
| | |
Exhibit Number | | Description |
99.1 | | Pentair plc press release dated July 21, 2015 announcing earnings results for the second quarter of 2015. |
Exhibit 99.1
News Release
Pentair Reports Second Quarter 2015 Results
| |
• | Second quarter sales of $1.7 billion. Total sales declined 9 percent consisting of a 2 percent decline in core sales and FX translation impact of negative 7 percent. |
| |
• | Adjusted EPS decreased 6 percent to $0.96 and adjusted operating margins declined 50 basis points to 14.7 percent compared to second quarter 2014 adjusted results. |
| |
• | Free cash flow was $310 million in the quarter and the company expects to deliver full year free cash flow greater than 120 percent of net income. |
| |
• | Beginning this quarter, Pentair will exclude non-cash amortization from adjusted EPS guidance to better reflect the company's performance. |
| |
• | The company updates 2015 adjusted EPS guidance to a range of $3.80 - $3.90. This excludes approximately $0.45 per share of non-cash amortization. The company's prior adjusted EPS guidance of $3.80 included non-cash amortization. |
Reconciliations of GAAP to Non-GAAP measures are in the attached financial tables.
MANCHESTER, United Kingdom — July 21, 2015— Pentair plc (NYSE: PNR) today announced second quarter 2015 sales of $1.7 billion. Sales were down 9 percent compared to sales for the same period last year. Adjusted second quarter 2015 earnings per diluted share from continuing operations (“EPS”) were $0.96, down 6 percent from adjusted EPS of $1.02 in the second quarter of last year. On a GAAP basis, the company reported EPS of $0.84 compared to EPS of $0.81 in the second quarter of 2014. Amounts excluded from adjusted EPS, adjusted operating income and segment income are described in the attached schedules.
“We had a solid quarter, but we are not satisfied with our results,” said Randall J. Hogan, Pentair Chairman and Chief Executive Officer. "Many of our served markets, especially those in energy and industrial, remain challenged and we do not expect them to recover in the second half of the year. We will continue to aggressively manage our cost structure and drive productivity to work through our near-term challenges. We are also continuing to invest in our high-performing Technical Solutions and Water Quality Systems segments where we see strategic organic and inorganic growth opportunities. We are confident these actions will position Pentair's portfolio for long-term growth and value creation.”
Second quarter 2015 adjusted operating income was $245 million, down 12 percent compared to the same period last year, and adjusted operating margins were 14.7 percent, a decline of 50 basis points when compared to adjusted second quarter 2014 operating margins.
Free cash flow in the quarter was $310 million and was $151 million for the first six months of 2015. The company expects to deliver full year free cash flow greater than 120 percent of net income.
Pentair paid dividends of $0.32 per share in the second quarter of 2015. Pentair previously announced on December 10, 2014 that its Board of Directors approved a 16 percent increase in the company's regular annual cash dividend rate for 2015 to $1.28 from $1.10. 2015 marks the 39th consecutive year that Pentair has increased its dividend.
SECOND QUARTER BUSINESS HIGHLIGHTS
All references to changes in core sales exclude the impact of currency translation. See attached reconciliations of these Non-GAAP measures.
Valves & Controls delivered second quarter 2015 sales of $496 million, down 21 percent versus the prior year quarter. Core sales declined 11 percent year over year for the second quarter and negative FX translation was 10 percent. Backlog decreased 14 percent to $1.2 billion compared to second quarter 2014.
| |
• | Core sales in the Energy vertical, which accounted for approximately 60 percent of Valves & Controls revenue in the quarter, decreased 10 percent. Core sales to the oil & gas industry were down 5 percent while core sales to the power industry decreased 8 percent. Core sales to the mining industry decreased 34 percent. |
| |
• | Core sales in the Industrial vertical, which accounted for approximately 40 percent of Valves & Controls revenue in the quarter, decreased 14 percent. |
Valves & Controls delivered second quarter segment income of $51 million, down 42 percent compared to $88 million in the same quarter last year. Second quarter segment margins decreased 360 basis points to 10.3 percent.
Flow & Filtration Solutions second quarter sales were $375 million, down 12 percent versus the prior year quarter. Core sales declined 5 percent in the second quarter and negative FX translation was 7 percent.
| |
• | Core sales in the Residential & Commercial vertical, which accounted for approximately 35 percent of Flow & Filtration Solutions revenue in the quarter, decreased 10 percent. |
| |
• | Core sales in the Food & Beverage vertical, which accounted for approximately 30 percent of Flow & Filtration Solutions revenue in the quarter, increased 2 percent. |
| |
• | Core sales in the Infrastructure vertical, which accounted for approximately 15 percent of Flow & Filtration Solutions revenue in the quarter, decreased 5 percent. |
| |
• | Core sales in the Industrial vertical, which accounted for approximately 15 percent of Flow & Filtration Solutions revenue in the quarter, decreased 4 percent. |
Flow & Filtration Solutions second quarter segment income of $50 million represented an 8 percent decrease as compared to $54 million in the same period last year. Segment margins increased by 60 basis points to 13.3 percent.
Water Quality Systems delivered second quarter 2015 sales of $388 million, up 3 percent versus the prior year quarter. Core sales grew 6 percent in the second quarter and negative FX translation was 3 percent.
| |
• | Core sales in the Residential & Commercial vertical, which accounted for approximately 85 percent of Water Quality Systems revenue in the quarter, increased 5 percent. |
| |
• | Core sales in the Food & Beverage vertical, which accounted for approximately 15 percent of Water Quality Systems revenue in the quarter, increased 10 percent. |
Water Quality Systems delivered second quarter segment income of $86 million, which represented a 5 percent increase compared to $82 million in the same quarter last year. Second quarter 2015 segment margins increased 40 basis points to 22.1 percent.
Technical Solutions delivered second quarter 2015 sales of $407 million, flat versus the prior year quarter. Core sales grew 6 percent in the second quarter and negative FX translation was 6 percent.
| |
• | Core sales in the Industrial vertical, which accounted for approximately 45 percent of Technical Solutions revenue in the quarter, were up 4 percent. |
| |
• | Core sales in the Energy vertical, which accounted for approximately 25 percent of Technical Solutions revenue in the quarter, increased 17 percent. |
| |
• | Core sales in the Residential & Commercial vertical, which accounted for approximately 15 percent of Technical Solutions revenue in the quarter, increased 10 percent. |
| |
• | Core sales in the Infrastructure vertical, which accounted for approximately 15 percent of Technical Solutions revenue in the quarter, decreased 5 percent. |
Technical Solutions delivered second quarter segment income of $81 million, up 5 percent compared to $77 million in the same quarter last year. Second quarter 2015 segment margins increased 110 basis points to 19.9 percent.
OUTLOOK
The company updated its full year 2015 adjusted EPS guidance to a range of $3.80 - $3.90, which excludes approximately $0.45 per share of non-cash amortization. The prior 2015 adjusted EPS guidance of $3.80 included non-cash amortization. On a comparable basis to the company's updated guidance, 2014 adjusted EPS was $4.23 excluding $0.45 of non-cash amortization. The company anticipates full year 2015 sales of $6.4 billion, or down approximately 8 to 9 percent over 2014 sales on a reported basis and down 2 to 3 percent on a core basis. The company expects to generate free cash flow in excess of 120 percent of net income in 2015.
Going forward, Pentair will exclude non-cash amortization from adjusted EPS guidance to better reflect the company's performance. The company introduced third quarter 2015 adjusted EPS guidance of $0.94 - $0.97, which excludes $0.12 of non-cash amortization, and down approximately 14 percent versus the same quarter last year's adjusted EPS. The company expects third quarter revenue to be approximately $1.6 billion, which would be down approximately 8 to 9 percent on a reported basis and down 2 to 3 percent on a core basis compared to third quarter 2014 revenue.
EARNINGS CONFERENCE CALL
Pentair Chairman and CEO Randall J. Hogan and Chief Financial Officer John L. Stauch will discuss the company’s performance and second quarter 2015 results on a two-way 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 Investors 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 presentation, both of which can be found on Pentair’s website. The webcast and presentation will be archived at the company’s website following the conclusion of the event.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This press 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,” “positioned,” “strategy,” “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 ability to achieve the benefits of planned cost take-out actions; the ability to successfully identify, complete and integrate acquisitions; overall global economic and business conditions; competition and pricing pressures in the markets we serve; the strength of housing and related markets; volatility in currency exchange rates and commodity prices; inability to generate savings from excellence in operations initiatives consisting of lean enterprise, supply management and cash flow practices; increased risks associated with operating foreign businesses; the ability to deliver backlog and win future project work; failure of markets to accept new product introductions and enhancements; the ability to successfully complete the disposition of the remaining portion of the Water Transport business on anticipated terms and timetable; the impact of changes in laws and regulations, including those that limit U.S. tax benefits; the outcome of litigation and governmental proceedings; and the ability to achieve our long-term strategic operating goals. Additional information concerning these and other factors is contained in our filings with the U.S. Securities and Exchange Commission, including in our 2014 Annual Report on Form 10-K. All forward-looking statements speak only as of the date of this press release. We assume no obligation, and disclaim any obligation, to update the information contained in this press release.
ABOUT PENTAIR PLC
Pentair plc (www.pentair.com) delivers industry-leading products, services and solutions for its customers’ diverse needs in water and other fluids, thermal management and equipment protection. With 2014 revenues of $7.0 billion, Pentair employs approximately 30,000 people worldwide.
PENTAIR CONTACTS:
Jim Lucas
Vice President, Investor Relations & Strategic Planning
Direct: 763-656-5575
Email: jim.lucas@pentair.com
Media Line
Direct: 763-656-5580
|
| | | | | | | | | | | | | |
Pentair plc and Subsidiaries |
Condensed Consolidated Statements of Operations (Unaudited) |
| | | | | |
| Three months ended | | Six months ended |
In millions, except per-share data | June 27, 2015 | June 28, 2014 | | June 27, 2015 | June 28, 2014 |
Net sales | $ | 1,661.2 |
| $ | 1,834.1 |
| | $ | 3,136.2 |
| $ | 3,478.1 |
|
Cost of goods sold | 1,095.0 |
| 1,187.8 |
| | 2,059.8 |
| 2,267.7 |
|
Gross profit | 566.2 |
| 646.3 |
| | 1,076.4 |
| 1,210.4 |
|
% of net sales | 34.1 | % | 35.2 | % | | 34.3 | % | 34.8 | % |
Selling, general and administrative | 319.3 |
| 389.7 |
| | 628.5 |
| 742.2 |
|
% of net sales | 19.3 | % | 21.3 | % | | 20.0 | % | 21.4 | % |
Research and development | 29.0 |
| 30.2 |
| | 58.8 |
| 59.7 |
|
% of net sales | 1.7 | % | 1.6 | % | | 1.9 | % | 1.7 | % |
Operating income | 217.9 |
| 226.4 |
| | 389.1 |
| 408.5 |
|
% of net sales | 13.1 | % | 12.3 | % | | 12.4 | % | 11.7 | % |
Other (income) expense: | | | | | |
Equity income of unconsolidated subsidiaries | (0.6 | ) | (0.3 | ) | | (1.1 | ) | (0.6 | ) |
Loss on sale of business | — |
| 0.2 |
| | — |
| 0.2 |
|
Net interest expense | 18.6 |
| 17.9 |
| | 36.8 |
| 34.0 |
|
% of net sales | 1.1 | % | 1.0 | % | | 1.2 | % | 1.0 | % |
Income from continuing operations before income taxes | 199.9 |
| 208.6 |
| | 353.4 |
| 374.9 |
|
Provision for income taxes | 46.0 |
| 49.4 |
| | 81.3 |
| 90.2 |
|
Effective tax rate | 23.0 | % | 23.7 | % | | 23.0 | % | 24.1 | % |
Net income from continuing operations | 153.9 |
| 159.2 |
| | 272.1 |
| 284.7 |
|
Income (loss) from discontinued operations, net of tax | (1.3 | ) | 2.3 |
| | (5.6 | ) | 1.0 |
|
Loss from sale / impairment of discontinued operations, net of tax | (4.8 | ) | — |
| | (4.8 | ) | (5.6 | ) |
Net income | $ | 147.8 |
| $ | 161.5 |
| | $ | 261.7 |
| $ | 280.1 |
|
Earnings (loss) per ordinary share | | | | | |
Basic | | | | | |
Continuing operations | $ | 0.85 |
| $ | 0.82 |
| | $ | 1.51 |
| $ | 1.46 |
|
Discontinued operations | (0.03 | ) | 0.02 |
| | (0.06 | ) | (0.02 | ) |
Basic earnings per ordinary share | $ | 0.82 |
| $ | 0.84 |
| | $ | 1.45 |
| $ | 1.44 |
|
Diluted | | | | | |
Continuing operations | $ | 0.84 |
| $ | 0.81 |
| | $ | 1.49 |
| $ | 1.44 |
|
Discontinued operations | (0.03 | ) | 0.01 |
| | (0.06 | ) | (0.03 | ) |
Diluted earnings per ordinary share | $ | 0.81 |
| $ | 0.82 |
| | $ | 1.43 |
| $ | 1.41 |
|
Weighted average ordinary shares outstanding | | | | | |
Basic | 179.8 |
| 193.1 |
| | 180.1 |
| 194.7 |
|
Diluted | 182.3 |
| 196.4 |
| | 182.6 |
| 198.0 |
|
Cash dividends paid per ordinary share | $ | 0.32 |
| $ | 0.25 |
| | $ | 0.64 |
| $ | 0.50 |
|
|
| | | | | | |
Pentair plc and Subsidiaries |
Condensed Consolidated Balance Sheets (Unaudited) |
| | |
| June 27, 2015 | December 31, 2014 |
In millions |
Assets |
Current assets | | |
Cash and cash equivalents | $ | 147.3 |
| $ | 110.4 |
|
Accounts and notes receivable, net | 1,170.6 |
| 1,205.9 |
|
Inventories | 1,200.4 |
| 1,130.4 |
|
Other current assets | 383.9 |
| 366.8 |
|
Current assets held for sale | 0.7 |
| 80.6 |
|
Total current assets | 2,902.9 |
| 2,894.1 |
|
Property, plant and equipment, net | 908.5 |
| 950.0 |
|
Other assets | | |
Goodwill | 4,732.1 |
| 4,741.9 |
|
Intangibles, net | 1,587.4 |
| 1,608.1 |
|
Other non-current assets | 416.7 |
| 436.2 |
|
Non-current assets held for sale | 17.1 |
| 24.9 |
|
Total other assets | 6,753.3 |
| 6,811.1 |
|
Total assets | $ | 10,564.7 |
| $ | 10,655.2 |
|
Liabilities and Equity |
Current liabilities | | |
Current maturities of long-term debt and short-term borrowings | $ | 5.3 |
| $ | 6.7 |
|
Accounts payable | 525.9 |
| 583.1 |
|
Employee compensation and benefits | 250.0 |
| 305.5 |
|
Other current liabilities | 675.7 |
| 709.1 |
|
Current liabilities held for sale | 3.1 |
| 35.1 |
|
Total current liabilities | 1,460.0 |
| 1,639.5 |
|
Other liabilities | | |
Long-term debt | 3,260.9 |
| 2,997.4 |
|
Pension and other post-retirement compensation and benefits | 305.1 |
| 322.0 |
|
Deferred tax liabilities | 465.1 |
| 528.3 |
|
Other non-current liabilities | 521.0 |
| 497.7 |
|
Non-current liabilities held for sale | 0.5 |
| 6.5 |
|
Total liabilities | 6,012.6 |
| 5,991.4 |
|
Equity | 4,552.1 |
| 4,663.8 |
|
Total liabilities and equity | $ | 10,564.7 |
| $ | 10,655.2 |
|
|
| | | | | | |
Pentair plc and Subsidiaries |
Condensed Consolidated Statements of Cash Flows (Unaudited) |
| Six months ended |
In millions | June 27, 2015 | June 28, 2014 |
Operating activities | | |
Net income | $ | 261.7 |
| $ | 280.1 |
|
Loss (income) from discontinued operations, net of tax | 5.6 |
| (1.0 | ) |
Loss from sale / impairment of discontinued operations, net of tax | 4.8 |
| 5.6 |
|
Adjustments to reconcile net income from continuing operations to net cash provided by (used for) operating activities of continuing operations | | |
Equity income of unconsolidated subsidiaries | (1.1 | ) | (0.6 | ) |
Depreciation | 66.8 |
| 69.3 |
|
Amortization | 55.6 |
| 57.5 |
|
Deferred income taxes | 4.9 |
| 9.7 |
|
Loss on sale of business | — |
| 0.2 |
|
Share-based compensation | 19.4 |
| 16.5 |
|
Excess tax benefits from share-based compensation | (4.6 | ) | (7.8 | ) |
Loss (gain) on sale of assets | (8.3 | ) | 0.2 |
|
Changes in assets and liabilities, net of effects of business acquisitions | | |
Accounts and notes receivable | 2.7 |
| 40.3 |
|
Inventories | (97.6 | ) | (26.5 | ) |
Other current assets | (35.6 | ) | (48.9 | ) |
Accounts payable | (43.4 | ) | (9.3 | ) |
Employee compensation and benefits | (41.2 | ) | (34.7 | ) |
Other current liabilities | 30.3 |
| 92.7 |
|
Other non-current assets and liabilities | (24.9 | ) | (26.1 | ) |
Net cash provided by (used for) operating activities of continuing operations | 195.1 |
| 417.2 |
|
Net cash provided by (used for) operating activities of discontinued operations | (9.6 | ) | (2.7 | ) |
Net cash provided by (used for) operating activities | 185.5 |
| 414.5 |
|
Investing activities | | |
Capital expenditures | (66.8 | ) | (59.6 | ) |
Proceeds from sale of property and equipment | 23.1 |
| 2.7 |
|
Acquisitions, net of cash acquired | (99.0 | ) | — |
|
Other | (0.5 | ) | 0.3 |
|
Net cash provided by (used for) investing activities of continuing operations | (143.2 | ) | (56.6 | ) |
Net cash provided by (used for) investing activities of discontinued operations | 59.0 |
| — |
|
Net cash provided by (used for) investing activities | (84.2 | ) | (56.6 | ) |
Financing activities | | |
Net receipts (repayments) of short-term borrowings | (0.3 | ) | 3.9 |
|
Net receipts of commercial paper and revolving long-term debt | 263.4 |
| 198.8 |
|
Repayments of long-term debt | (4.3 | ) | (12.9 | ) |
Excess tax benefits from share-based compensation | 4.6 |
| 7.8 |
|
Shares issued to employees, net of shares withheld | 17.3 |
| 31.5 |
|
Repurchases of ordinary shares | (200.0 | ) | (450.7 | ) |
Dividends paid | (115.6 | ) | (99.1 | ) |
Purchase of noncontrolling interest | — |
| (134.7 | ) |
Net cash provided by (used for) financing activities | (34.9 | ) | (455.4 | ) |
Effect of exchange rate changes on cash and cash equivalents | (29.5 | ) | 6.0 |
|
Change in cash and cash equivalents | 36.9 |
| (91.5 | ) |
Cash and cash equivalents, beginning of period | 110.4 |
| 256.0 |
|
Cash and cash equivalents, end of period | $ | 147.3 |
| $ | 164.5 |
|
Free cash flow | | |
Net cash provided by (used for) operating activities of continuing operations | $ | 195.1 |
| $ | 417.2 |
|
Capital expenditures | (66.8 | ) | (59.6 | ) |
Proceeds from sale of property and equipment | 23.1 |
| 2.7 |
|
Free cash flow | $ | 151.4 |
| $ | 360.3 |
|
|
| | | | | | | | | | | | | | | | | | | |
Pentair plc and Subsidiaries |
Supplemental Financial Information by Reportable Segment (Unaudited) |
| | | | | | | |
| 2015 | | 2014 |
In millions | First Quarter | Second Quarter | Six Months | | First Quarter | Second Quarter | Six Months |
Net sales | | | | | | | |
Valves & Controls | $ | 429.2 |
| $ | 496.4 |
| $ | 925.6 |
| | $ | 531.0 |
| $ | 628.6 |
| $ | 1,159.6 |
|
Flow & Filtration Solutions | 350.1 |
| 374.6 |
| 724.7 |
| | 401.1 |
| 424.5 |
| 825.6 |
|
Water Quality Systems | 306.9 |
| 387.7 |
| 694.6 |
| | 304.0 |
| 377.9 |
| 681.9 |
|
Technical Solutions | 395.8 |
| 407.1 |
| 802.9 |
| | 415.3 |
| 408.6 |
| 823.9 |
|
Other | (7.0 | ) | (4.6 | ) | (11.6 | ) | | (7.4 | ) | (5.5 | ) | (12.9 | ) |
Consolidated | $ | 1,475.0 |
| $ | 1,661.2 |
| $ | 3,136.2 |
| | $ | 1,644.0 |
| $ | 1,834.1 |
| $ | 3,478.1 |
|
Segment income (loss) | | | | | | | |
Valves & Controls | $ | 42.0 |
| $ | 51.1 |
| $ | 93.1 |
| | $ | 60.9 |
| $ | 87.7 |
| $ | 148.6 |
|
Flow & Filtration Solutions | 29.1 |
| 49.7 |
| 78.8 |
| | 34.7 |
| 54.0 |
| 88.7 |
|
Water Quality Systems | 49.3 |
| 85.7 |
| 135.0 |
| | 47.7 |
| 82.0 |
| 129.7 |
|
Technical Solutions | 72.7 |
| 80.8 |
| 153.5 |
| | 79.0 |
| 76.6 |
| 155.6 |
|
Other | (21.9 | ) | (22.4 | ) | (44.3 | ) | | (21.7 | ) | (21.0 | ) | (42.7 | ) |
Consolidated | $ | 171.2 |
| $ | 244.9 |
| $ | 416.1 |
| | $ | 200.6 |
| $ | 279.3 |
| $ | 479.9 |
|
Segment income as a percent of net sales | | | | | | | |
Valves & Controls | 9.8 | % | 10.3 | % | 10.1 | % | | 11.5 | % | 13.9 | % | 12.8 | % |
Flow & Filtration Solutions | 8.3 | % | 13.3 | % | 10.9 | % | | 8.7 | % | 12.7 | % | 10.7 | % |
Water Quality Systems | 16.1 | % | 22.1 | % | 19.4 | % | | 15.7 | % | 21.7 | % | 19.0 | % |
Technical Solutions | 18.4 | % | 19.9 | % | 19.1 | % | | 19.1 | % | 18.8 | % | 18.9 | % |
Consolidated | 11.6 | % | 14.7 | % | 13.3 | % | | 12.2 | % | 15.2 | % | 13.8 | % |
|
| | | | | | | | | | | | | | | | |
Pentair plc and Subsidiaries |
Reconciliation of the GAAP “As Reported” year ended December 31, 2015 to the “Adjusted” non-GAAP |
excluding the effect of 2015 adjustments (Unaudited) |
| | | | | | | | |
| Actual | | Forecast |
In millions, except per-share data | First Quarter | Second Quarter | | Third Quarter | | Full Year |
Total Pentair | | | | | | | | |
Net sales | $ | 1,475.0 |
| $ | 1,661.2 |
| | approx | $ | 1,595 |
| | approx | $ | 6,400 |
|
Operating income—as reported | 171.2 |
| 217.9 |
| | approx | 188 |
| | approx | 792 |
|
% of net sales | 11.6 | % | 13.1 | % | | approx | 11.8 | % | | approx | 12.4 | % |
Adjustments: | | | | | | | | |
Restructuring and other | — |
| 25.5 |
| | approx | 30 |
| | approx | 85 |
|
Inventory step-up | — |
| 1.5 |
| | approx | 2 |
| | approx | 3 |
|
Operating income—as adjusted | 171.2 |
| 244.9 |
| | approx | 220 |
| | approx | 880 |
|
% of net sales | 11.6 | % | 14.7 | % | | approx | 13.8 | % | | approx | 13.8 | % |
Net income from continuing operations—as reported | 118.2 |
| 153.9 |
| | approx | 130 |
| | approx | 553 |
|
Adjustments, net of tax | — |
| 20.8 |
| | approx | 25 |
| | approx | 69 |
|
Net income from continuing operations—as adjusted | $ | 118.2 |
| $ | 174.7 |
| | approx | $ | 155 |
| | approx | $ | 622 |
|
Intangible asset amortization, net of tax | 21.2 |
| 21.6 |
| | approx | 21 |
| | approx | 86 |
|
Net income from continuing operations—as adjusted, excluding intangible asset amortization | $ | 139.4 |
| $ | 196.3 |
| | approx | $ | 176 |
| | approx | $ | 708 |
|
Continuing earnings per ordinary share—diluted | | | | |
|
| |
|
|
|
Diluted earnings per ordinary share—as reported | $ | 0.65 |
| $ | 0.84 |
| | approx | $0.68 - 0.71 |
| | approx | $2.97 - 3.07 |
|
Adjustments | — |
| 0.12 |
| | approx | 0.14 |
| | approx | 0.38 |
|
Diluted earnings per ordinary share—as adjusted | $ | 0.65 |
| $ | 0.96 |
| | approx | $0.82 - 0.85 |
| | approx | $3.35 - 3.45 |
|
Intangible asset amortization | 0.11 |
| 0.12 |
| | approx | 0.12 |
| | approx | 0.45 |
|
Diluted earnings per ordinary share—as adjusted, excluding intangible asset amortization | $ | 0.76 |
| $ | 1.08 |
| | approx | $0.94 - 0.97 |
| | approx | $3.80 - 3.90 |
|
|
| | | | | | | | |
Pentair plc and Subsidiaries |
Reconciliation of Net Sales Growth to Core Net Sales Growth by Vertical |
for the quarter ending June 27, 2015 (Unaudited) |
| Q2 Net Sales Growth |
| Core | Currency | Acq./ Div. | Total |
Valves & Controls | (11.3 | )% | (9.7 | )% | — | % | (21.0 | )% |
Industrial | (13.7 | )% | (7.3 | )% | — | % | (21.0 | )% |
Energy | (9.8 | )% | (11.1 | )% | — | % | (20.9 | )% |
Flow & Filtration Solutions | (4.8 | )% | (7.0 | )% | — | % | (11.8 | )% |
Industrial | (3.9 | )% | (5.4 | )% | — | % | (9.3 | )% |
Residential & Commercial | (9.8 | )% | (6.9 | )% | — | % | (16.7 | )% |
Food & Beverage | 2.4 | % | (8.7 | )% | — | % | (6.3 | )% |
Infrastructure | (4.6 | )% | (6.7 | )% | — | % | (11.3 | )% |
Water Quality Systems | 5.6 | % | (3.0 | )% | — | % | 2.6 | % |
Residential & Commercial | 4.8 | % | (2.6 | )% | — | % | 2.2 | % |
Food & Beverage | 10.3 | % | (4.9 | )% | — | % | 5.4 | % |
Technical Solutions | 6.0 | % | (6.4 | )% | — | % | (0.4 | )% |
Industrial | 3.6 | % | (7.2 | )% | — | % | (3.6 | )% |
Residential & Commercial | 10.2 | % | (7.5 | )% | — | % | 2.7 | % |
Energy | 16.7 | % | (5.1 | )% | — | % | 11.6 | % |
Infrastructure | (4.7 | )% | (6.3 | )% | — | % | (11.0 | )% |
Total Pentair | (2.5 | )% | (6.9 | )% | — | % | (9.4 | )% |
Industrial | (6.1 | )% | (7.0 | )% | — | % | (13.1 | )% |
Residential & Commercial | 1.3 | % | (4.4 | )% | — | % | (3.1 | )% |
Energy | (5.0 | )% | (9.7 | )% | — | % | (14.7 | )% |
Food & Beverage | 5.2 | % | (7.3 | )% | — | % | (2.1 | )% |
Infrastructure | (3.9 | )% | (6.4 | )% | — | % | (10.3 | )% |
|
| | | | | | | | | | | | | | | | |
Pentair plc and Subsidiaries |
Reconciliation of the GAAP “As Reported” year ended December 31, 2014 to the “Adjusted” non-GAAP |
excluding the effect of 2014 adjustments (Unaudited) |
| | | | | | |
In millions, except per-share data | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | | Full Year |
Total Pentair | | | | | | |
Net sales | $ | 1,644.0 |
| $ | 1,834.1 |
| $ | 1,758.4 |
| $ | 1,802.5 |
| | $ | 7,039.0 |
|
Operating income—as reported | 182.1 |
| 226.4 |
| 267.4 |
| 176.0 |
| | 851.9 |
|
% of net sales | 11.1 | % | 12.3 | % | 15.2 | % | 9.8 | % | | 12.1 | % |
Adjustments: | | | | | | |
Restructuring and other | 17.0 |
| 44.1 |
| — |
| 48.5 |
| | 109.6 |
|
Pension and other post-retirement mark-to-market loss | — |
| — |
| — |
| 49.9 |
| | 49.9 |
|
Redomicile related expenses | 1.5 |
| 8.8 |
| — |
| — |
| | 10.3 |
|
Operating income—as adjusted | 200.6 |
| 279.3 |
| 267.4 |
| 274.4 |
| | 1,021.7 |
|
% of net sales | 12.2 | % | 15.2 | % | 15.2 | % | 15.2 | % | | 14.5 | % |
Net income from continuing operations—as reported | 125.5 |
| 159.2 |
| 192.5 |
| 129.8 |
| | 607.0 |
|
Adjustments, net of tax | 16.4 |
| 41.5 |
| — |
| 66.8 |
| | 124.7 |
|
Net income from continuing operations—as adjusted | $ | 141.9 |
| $ | 200.7 |
| $ | 192.5 |
| $ | 196.6 |
| | $ | 731.7 |
|
Intangible asset amortization, net of tax
| 21.7 |
| 22.0 |
| 21.5 |
| 20.8 |
| | 86.0 |
|
Net income from continuing operations—as adjusted, excluding intangible asset amortization | $ | 163.6 |
| $ | 222.7 |
| $ | 214.0 |
| $ | 217.4 |
| | $ | 817.7 |
|
Continuing earnings per ordinary share—diluted | | | | | | |
Diluted earnings per ordinary share—as reported | $ | 0.63 |
| $ | 0.81 |
| $ | 1.00 |
| $ | 0.70 |
| | $ | 3.14 |
|
Adjustments | 0.08 |
| 0.21 |
| — |
| 0.36 |
| | 0.64 |
|
Diluted earnings per ordinary share—as adjusted | $ | 0.71 |
| $ | 1.02 |
| $ | 1.00 |
| $ | 1.06 |
| | $ | 3.78 |
|
Intangible asset amortization | 0.11 |
| 0.11 |
| 0.11 |
| 0.11 |
| | 0.45 |
|
Diluted earnings per ordinary share—as adjusted, excluding intangible asset amortization | $ | 0.82 |
| $ | 1.13 |
| $ | 1.11 |
| $ | 1.17 |
| | $ | 4.23 |
|
Pentair (NYSE:PNR)
Historical Stock Chart
From Apr 2024 to May 2024
Pentair (NYSE:PNR)
Historical Stock Chart
From May 2023 to May 2024