PENTAIR plc
For the period ended Dec 31, 2024. Filed Feb 25, 2025.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 25, 2025
PNR$68.12-2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-20.
0000077360-24-000007
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-25.
0000077360-25-000006
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 211 previous paragraphs and 187 current paragraphs.
100 unchanged; 57 reworded; 29 added; 46 removed; 8 previous and 1 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (29)
Current report
On December 2, 2024, as part of our Pool reportable segment, we completed the acquisition of G & F Manufacturing, LLC (“G & F Manufacturing”) for $116.0 million in cash, net of cash acquired and subject to customary adjustments. The net purchase price is comprised of an upfront cash payment of $108.0 million, subject to customary adjustments, and the estimated fair value at the acquisition date of a contingent earn-out liability based upon the achievement of certain defined operating results in the two years following the acquisition. G & F Manufacturing manufactures and services pool heat pumps.
Current report
•In 2024, we began using 80/20 guiding principles to enable our Transformation Program. This 80/20 analysis is expected to create value by focusing on key customers and products through quadrant-based strategies. We expect the analysis to result in actions to improve operating performance by driving growth with our highest value customers, reducing lower margin sales and removing complexity in the future.
Current report
•a product line exit in our Pool segment that occurred in 2024.
Current report
This decrease was partially offset by:
Current report
•increased sales volume within our Pool segment due to higher demand compared to the prior year; and
Current report
•increased productivity mainly driven by transformation initiatives.
Current report
•asset impairment and write-offs of $11.3 million recorded in 2024, compared to $7.0 million recorded in 2023.
Current report
•asset impairment charges of $6.3 million in 2024, compared to $0.9 million in 2023.
Current report
•a reduction in our legal accrual of $7.5 million in 2024, compared to an increase in our legal accrual of $2.2 million in 2023.
Current report
•lower variable-rate debt compared to the prior year.
Current report
Provision for income taxes
Current report
•withholding taxes primarily related to the repatriation of earnings in 2024 which did not occur in 2023; and
Current report
•the favorable impact of discrete items that occurred during 2024 primarily related to changes in uncertain tax positions.
Current report
The decrease was partially offset by:
Current report
•increased selling prices to mitigate inflationary cost increases; and
Current report
•increased sales volume in our commercial flow business compared to the prior year.
Current report
•increased productivity mainly driven by transformation initiatives; and
Current report
•decreased sales volume compared to the prior year, in addition to the completion of a large project in 2023 within our commercial business that did not recur in 2024;
Current report
•unfavorable foreign currency effects compared to the prior year; and
Current report
•a business exit in our residential business that occurred in 2024.
Current report
This decrease was partially offset by:
Current report
•increased productivity mainly driven by transformation initiatives; and
Current report
•increased sales volume due to higher demand compared to the prior year;
Current report
•increased selling prices to mitigate inflationary cost increases; and
Current report
•increased sales due to the acquisition of G & F Manufacturing completed in the fourth quarter of 2024.
Current report
•a product line exit that occurred in 2024.
Current report
•increased productivity driven by transformation initiatives.
Current report
On December 2, 2024, as part of our Pool reportable segment, we completed the acquisition of G & F Manufacturing for approximately $116.0 million in cash, net of cash acquired, including an upfront cash payment of $108.0 million. We funded the purchase price for this acquisition with cash on hand.
Current report
In 2024, net cash used for financing activities primarily relates to the repayment of $200.0 million of term loans under the Senior Credit Facility (as defined below), $162.5 million of principal payments on the Term Loan Facility (as defined below), dividend payments of $152.3 million and share repurchases of $150.0 million.
Removed paragraphs (46)
Previous report
In July 2022, as part of our Water Solutions reporting segment, we acquired the issued and outstanding equity securities of certain subsidiaries of Welbilt, Inc. (“Welbilt”) and certain other assets, rights, and properties, and assumed certain liabilities, comprising Welbilt’s Manitowoc Ice business (“Manitowoc Ice”), for approximately $1.6 billion in cash.
Previous report
•decreased sales volume in our residential business within our Water Solutions segment driven by lower demand compared to the prior year and certain business exits announced in the second half of 2022; and
Previous report
•decreased sales volume in our Pool segment primarily due to higher channel inventory and lower demand compared to the prior year.
Previous report
•increased sales within our Water Solutions segment from the acquisition of Manitowoc Ice, which was completed in the third quarter of 2022;
Previous report
•increased sales volume in our commercial business within our Water Solutions segment driven by demand and easing of supply chain pressures, which allowed increased productivity and delivery to market; and
Previous report
•increased selling prices to mitigate impacts of inflation as well as lower rebates and incentives in our Pool segment;
Previous report
•increased productivity within our Water Solutions segment as a result of certain transformation and restructuring initiatives;
Previous report
•increased productivity in our Flow segment mainly driven by manufacturing leverage and transformation initiatives;
Previous report
•inventory impairments and write-offs and certain accruals of $19.6 million, recorded in 2022 as part of exiting businesses in our Water Solutions segment; and
Previous report
•amortization of inventory fair market value step-up of $5.8 million in 2022, as a result of the Manitowoc Ice acquisition.
Previous report
•inventory impairments and write-offs of $7.0 million in 2023.
Previous report
•higher employee compensation costs compared to the prior year; and
Previous report
•no deal-related costs and expenses in 2023, compared to $22.2 million in 2022; and
Previous report
•increased variable interest rates in 2023 compared to the prior year; and
Previous report
•increased debt due to the acquisition of Manitowoc Ice in the third quarter of 2022.
Previous report
•the amortization of debt issuance costs of $9.0 million in 2022 related to financing commitments for a bridge loan facility established in connection with the acquisition of Manitowoc Ice that did not recur in 2023.
Previous report
(Benefit) provision for income taxes
Previous report
•the favorable impact of discrete items primarily related to increases in tax basis in assets located in foreign jurisdictions; and
Previous report
•favorable foreign currency effects in 2023 compared to the prior year.
Previous report
The increase was partially offset by:
Previous report
•increased productivity mainly driven by manufacturing leverage and transformation initiatives.
Previous report
•increased sales as a result of the acquisition of Manitowoc Ice, which was completed in the third quarter of 2022;
Previous report
•higher sales volume in our commercial business driven by higher demand and easing of supply chain pressures, which allowed increased production and delivery to market; and
Previous report
•decreased sales volume in our residential business driven by lower demand in 2023 compared to the prior year and certain business exits announced in the second half of 2022; and
Previous report
•increased sales due to the acquisitions of Manitowoc Ice and Ken’s Beverage, Inc. completed in the third quarter of 2022 and the second quarter of 2021, respectively;
Previous report
•increased sales volume in our commercial business in 2022 compared to the prior year.
Previous report
•increased sales as a result of the Manitowoc Ice acquisition;
Previous report
•increased productivity in the residential business as a result of certain transformation and restructuring initiatives.
Previous report
•increased sales as a result of the Manitowoc Ice acquisition in the third quarter of 2022; and
Previous report
•inflationary cost increases due to high demand and limited supply of raw materials such as metals, resins and electronics along with increased logistics and labor costs;
Previous report
•decreased productivity in our residential business due to decreased sales volume; and
Previous report
•sales volume decreases primarily due to higher channel inventory and lower demand compared to the prior year.
Previous report
•increased selling prices to mitigate a rise in inflationary costs as well as lower rebates and incentives.
Previous report
•decreased sales volume in 2022 compared to the prior year; and
Previous report
•increased selling prices to mitigate impacts of inflation as well as lower rebates and incentives;
Previous report
•increased productivity associated with benefits realized from our transformation initiatives; and
Previous report
•cost management initiatives associated with decreased sales volume.
Previous report
The 0.5 percentage point decrease in segment income for Pool as a percentage of net sales in 2022 from 2021 was primarily the result of:
Previous report
•inflationary cost increases due to high demand and limited supply of raw materials such as metals, resins and electronics along with increased logistics and labor costs; and
Previous report
•decreased productivity due to decreased sales volume.
Showing the first 40 of 46 passages. Open the source sections for the rest.
Reworded paragraphs (57)
Previous wording
This report 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 international hostilities; 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 this Annual Report on Form 10-K. All forward-looking statements speak only as of the date of this report. Pentair assumes no obligation, and disclaims any obligation, to update the information contained in this report.
Current wording
This report 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 international hostilities; 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 sustainability goals and targets. Additional information concerning these and other factors is contained in our filings with the U.S. Securities and Exchange Commission (the “SEC”), including this Annual Report on Form 10-K. All forward-looking statements speak only as of the date of this report. Pentair assumes no obligation, and disclaims any obligation, to update the information contained in this report.
Previous wording
Pentair plc and its consolidated subsidiaries (“we,” “us,” “our,” “Pentair” or the “Company”) is a pure play water industrial manufacturing company comprised of three reporting segments: Flow (formerly named the Industrial & Flow Technologies segment), Water Solutions and Pool. We classify our operations into business segments based primarily on types of products offered and markets served. For the year ended December 31, 2023, the Flow, Water Solutions and Pool segments represented approximately 38%, 29% and 33% of total revenues, respectively.
Current wording
Pentair plc and its consolidated subsidiaries (“we,” “us,” “our,” “Pentair” or the “Company”) is a pure play water industrial manufacturing company comprised of three reportable segments: Flow, Water Solutions and Pool. We classify our operations into business segments based primarily on types of products offered and markets served. For the year ended December 31, 2024, the Flow, Water Solutions and Pool reportable segments represented approximately 37%, 28% and 35% of total consolidated net sales, respectively.
Previous wording
•In 2021, we created a transformation office and launched and committed resources to the Transformation Program designed to accelerate growth and drive margin expansion by driving operational excellence, reducing complexity and streamlining our processes. During 2023, we made strategic progress on our Transformation Program initiatives with a focus on our four key themes of pricing excellence, strategic sourcing, operations excellence and organizational effectiveness. We expect to continue to execute on our key Transformation Program initiatives to drive margin expansion and to continue to incur transformation costs in 2024 and beyond.
Current wording
•We have a Transformation Program designed to accelerate growth and drive margin expansion by driving operational excellence, reducing complexity and streamlining our processes. During 2024, we made strategic progress on our Transformation Program initiatives with a focus on our four key themes of pricing excellence, strategic sourcing, operations excellence and organizational effectiveness. We expect to continue to execute on our key Transformation Program initiatives to drive margin expansion and to continue to incur transformation costs in 2025 and beyond.
Previous wording
•The current volatile market for commodities has the potential to drive price increases in our supply chain. While we have taken pricing actions and implemented transformation initiatives that we expect to improve productivity and offset cost increases, we anticipate supply chain pressures and inflationary cost increases to continue into 2024.
Current wording
•During 2024, we experienced inflationary cost increases for certain raw materials as well as logistics and transportation costs. The ongoing volatile market for commodities has the potential to continue to drive price increases in our supply chain. In addition, the current U.S. administration has recently implemented tariffs and has announced the possibility of implementing additional, or increasing current, tariffs; these actions and any reactionary tariff adjustments by other countries may also contribute to inflationary cost increases. As a result, we have taken pricing actions, which may continue going forward, and implemented transformation initiatives that we expect to improve productivity and offset cost increases. We anticipate supply chain pressures and inflationary cost increases due to potential tariffs and pressure on global manufacturing to continue into 2025.
Previous wording
•The Organization for Economic Co-operation and Development Pillar Two Model Rules (“Pillar Two”), for a global 15.0% minimum tax, are in the process of being adopted by a number of jurisdictions in which we operate. In particular, the U.K. has completed passage of legislation to comply with the Pillar Two framework, which became effective at the start of 2024. We expect Pillar Two to have a negative 1.0% to 1.5% impact to our effective tax rate in 2024. That impact could change in the future as we continue to evaluate the enacted legislative changes and as new guidance becomes available.
Current wording
•The Organization for Economic Co-operation and Development Pillar Two Model Rules (“Pillar Two”), for a global 15.0% minimum tax, have been adopted by a number of jurisdictions in which we operate. Pillar Two has negatively impacted our effective tax rate in 2024 and is likely to continue to impact our effective tax rate in the future. We continue to evaluate the enacted legislative changes and new guidance as it becomes available.
Previous wording
•Focusing growth initiatives that accelerate our investments in digital, innovation, technology and ESG;
Current wording
•Focusing growth initiatives that accelerate our investments in digital, innovation, technology and sustainability;
Previous wording
•Continuing to implement our Transformation Program initiatives that will drive operational excellence, reduce complexity and improve our organizational structure; and
Current wording
•Continuing to implement our Transformation Program initiatives that will drive operational excellence, reduce complexity and improve our organizational structure, which includes the focus on 80/20 actions to drive profitable growth; and
Previous wording
The 0.4 percent decrease in consolidated net sales in 2023 from 2022 was primarily the result of:
Current wording
The 0.5 percent decrease in consolidated net sales in 2024 from 2023 was primarily the result of:
Previous wording
•increased sales volume in our commercial and industrial solutions businesses within our Flow segment compared to the prior year.
Current wording
•decreased sales volume in our residential flow and industrial solutions businesses within our Flow segment compared to the prior year;
Previous wording
•decreased sales volume in our residential business in 2023 compared to the prior year.
Current wording
•decreased sales volume in our Water Solutions segment compared to the prior year, in addition to a business exit in our residential business in 2024 and the completion of a large project in 2023 within our commercial business that did not recur in 2024; and
Previous wording
•increased selling prices to mitigate inflationary cost increases.
Current wording
•increased selling prices across all of our segments to mitigate inflationary cost increases;
Previous wording
•decreased sales volume in our residential business within our Flow segment compared to the prior year;
Current wording
•increased sales volume in our commercial flow business within our Flow segment compared to the prior year;
Previous wording
•increased sales due to the acquisition of Pleatco Holdings, LLC completed in the fourth quarter of 2021.
Current wording
•increased sales due to the acquisition of G & F Manufacturing completed in the fourth quarter of 2024.
Previous wording
The 3.9 percentage point increase in gross profit as a percentage of net sales in 2023 from 2022 was primarily the result of:
Current wording
The 2.2 percentage point increase in gross profit as a percentage of net sales in 2024 from 2023 was primarily the result of:
Previous wording
•increases in selling prices to mitigate the impacts of inflation; and
Current wording
•increases in selling prices to mitigate impacts of inflationary costs; and
Previous wording
The 0.2 percentage point increase in SG&A expense as a percentage of net sales in 2023 from 2022 was driven by:
Current wording
The 0.6 percentage point increase in SG&A expense as a percentage of net sales in 2024 from 2023 was driven by:
Previous wording
•transformation costs of $44.3 million in 2023, compared to $27.2 million in 2022.
Current wording
•transformation costs of $52.0 million in 2024, compared to $44.3 million in 2023;
Previous wording
•restructuring costs of $9.1 million in 2023, compared to $36.7 million in 2022.
Current wording
•restructuring costs of $34.4 million in 2024, compared to $9.1 million in 2023; and
Previous wording
The increase in net interest expense in 2023 from 2022 was the result of:
Current wording
The 25.1 percent decrease in net interest expense in 2024 from 2023 was the result of:
Previous wording
The 12.8 percentage point decrease in the effective tax rate in 2023 from 2022 was primarily due to:
Current wording
The 13.6 percentage point increase in the effective tax rate in 2024 from 2023 was primarily due to:
Previous wording
•the favorable impact of worthless stock deductions related to exiting certain businesses in our Water Solutions segment;
Current wording
•favorable impacts in the prior year that did not recur in the current year, including worthless stock deductions related to exiting certain businesses in our Water Solutions segment and increases in tax basis of assets located in foreign jurisdictions;
Previous wording
•the favorable mix of global earnings.
Current wording
•the unfavorable mix of global earnings.
Previous wording
A discussion of changes in our consolidated results of operations, segment results of operations for the Flow (formerly named Industrial & Flow Technologies) segment and liquidity and capital resources from the year ended December 31, 2022 to December 31, 2021 can be found in Part II, ITEM 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 21, 2023. However, such discussion is not incorporated by reference into, and does not constitute a part of, this Annual Report on Form 10-K.
Current wording
A discussion of changes in our consolidated results of operations, segment results of operations and liquidity and capital resources from the year ended December 31, 2023 to December 31, 2022 can be found in Part II, ITEM 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 20, 2024. However, such discussion is not incorporated by reference into, and does not constitute a part of, this Annual Report on Form 10-K.
Previous wording
The summary that follows provides a discussion of the results of operations of our three reportable segments (Flow, Water Solutions and Pool). Each of these segments is comprised of various product offerings that serve multiple end users.
Current wording
The summary that follows provides a discussion of the results of operations of our three reportable segments (Flow, Water Solutions and Pool). Each of these segments comprises various product offerings that serve multiple end users.
Previous wording
We evaluate performance based on net sales and segment income and use a variety of ratios to measure performance of our reporting segments. Segment income represents equity income of unconsolidated subsidiaries and operating income exclusive of intangible amortization, certain acquisition related expenses, costs of restructuring and transformation activities, impairments and other unusual non-operating items.
Current wording
We evaluate performance based on net sales and reportable segment income (“segment income”) and use certain ratios, particularly return on sales, to measure performance of our reportable segments. Segment income represents operating income of each reportable segment inclusive of equity income of unconsolidated subsidiaries and exclusive of intangible amortization, certain acquisition related expenses, costs of restructuring and transformation activities, impairments, legal accrual adjustments and settlements and other unusual non-operating items.
Previous wording
The 5.4 percent increase in net sales for Flow in 2023 from 2022 was primarily the result of:
Current wording
The 4.3 percent decrease in net sales for Flow in 2024 from 2023 was primarily the result of:
Previous wording
•increased sales volume in our commercial and industrial solutions businesses in 2023 compared to the prior year; and
Current wording
•decreased sales volume in our residential flow and industrial solutions businesses compared to the prior year.
Previous wording
The 1.7 percentage point increase in segment income for Flow as a percentage of net sales in 2023 from 2022 was primarily the result of:
Current wording
The 3.2 percentage point increase in segment income for Flow as a percentage of net sales in 2024 from 2023 was primarily the result of:
Previous wording
The 19.3 percent increase in net sales for Water Solutions in 2023 from 2022 was primarily the result of:
Current wording
The 3.9 percent decrease in net sales for Water Solutions in 2024 from 2023 was primarily the result of:
Previous wording
The 5.9 percentage point increase in segment income for Water Solutions as a percentage of net sales in 2023 from 2022 was primarily the result of:
Current wording
The 1.6 percentage point increase in segment income for Water Solutions as a percentage of net sales in 2024 from 2023 was primarily the result of:
Previous wording
•increased selling prices to mitigate a rise in inflationary costs as well as lower rebates and incentives in our Pool segment;
Current wording
•increased selling prices to mitigate impacts of inflation.
Previous wording
The 3.9 percent increase in net sales for Pool in 2022 from 2021 was primarily the result of:
Current wording
The 6.9 percent increase in net sales for Pool in 2024 from 2023 was primarily the result of:
Previous wording
The 2.7 percentage point increase in segment income for Pool as a percentage of net sales in 2023 from 2022 was primarily the result of:
Current wording
The 2.2 percentage point increase in segment income for Pool as a percentage of net sales in 2024 from 2023 was primarily the result of:
Previous wording
The majority of our backlog is short cycle in nature with shipments within one year from when a customer places an order, and a substantial portion of our revenues has historically resulted from orders received and products delivered in the same month. A portion of our backlog, particularly from orders for major capital projects, can take more than one year from order to delivery depending on the size and type of order. We record, as part of our backlog, all orders from external customers, which represent firm commitments, and are supported by a purchase order or other legitimate contract. Our backlog of orders is dependent upon when customers place orders and is not necessarily an indicator of our expected results for our 2024 net sales. The decrease in our overall backlog from the prior year was primarily driven by our backlog trending down to more historical levels as a result of increased manufacturing capacity and improved lead times.
Current wording
The majority of our backlog is short cycle in nature with shipments within one year from when a customer places an order, and a substantial portion of our revenues has historically resulted from orders received and products delivered in the same month. A portion of our backlog, particularly from orders for major capital projects, can take more than one year from order to delivery depending on the size and type of order. We record, as part of our backlog, all orders from external customers, which represent firm commitments, and are supported by a purchase order or other legitimate contract. Our backlog of orders is dependent upon when customers place orders and is not necessarily an indicator of our expected results for our 2025 net sales. The decrease in our overall backlog from the prior year was primarily driven by our backlog trending down to more historical levels as a result of increased manufacturing capacity and improved lead times within each of our reportable segments as well as timing of delivery of orders associated with certain advance sale (“early buy”) programs within our Pool segment.
Previous wording
End-user demand for pool equipment in the Pool segment, water solution products in the Water Solutions segment, and residential water supply and agricultural products within the Flow segment follows warm weather trends, with seasonal highs from April to September. The magnitude of the sales spike has historically been partially mitigated by employing some advance sale “early buy” programs (generally including extended payment terms and/or additional discounts). Demand for residential and agricultural water systems is also impacted by weather patterns, particularly by temperature, heavy flooding and droughts.
Current wording
End-user demand for pool equipment in the Pool segment, water solution products in the Water Solutions segment, and residential water supply and agricultural products within the Flow segment follows warm weather trends, with seasonal highs ranging from April to September. The magnitude of the sales spike has historically been partially mitigated by employing some advance sale “early buy” programs (generally including extended payment terms and/or additional discounts). Demand for residential and agricultural water systems is also impacted by weather patterns, particularly by temperature, heavy flooding and droughts.
Previous wording
In 2022, net cash provided by operating activities of continuing operations primarily reflects net income from continuing operations, net of non-cash depreciation, definite-lived intangible amortization and asset impairment, of $615.4 million. Additionally, we had a cash outflow of $218.7 million as a result of changes in net working capital, primarily due to increased inventory balances compared to December 31, 2021. Inventory was higher due to inflationary impacts, continued supply chain inefficiencies and a rebalancing of inventory levels in the residential channel.
Current wording
In 2024, net cash provided by operating activities of continuing operations primarily reflects net income from continuing operations, net of non-cash depreciation, definite-lived intangible amortization and asset impairment, of $757.8 million.
Previous wording
Net cash used for investing activities in 2022 primarily reflects the net cash paid of $1,579.5 million for the Manitowoc Ice acquisition and capital expenditures of $85.2 million, partially offset by cash received upon the settlement of net investment hedges of $78.9 million.
Current wording
Net cash used for investing activities in 2024 primarily reflects net cash paid of $108.0 million for the acquisition of G & F Manufacturing, capital expenditures of $74.4 million and cash paid upon the settlement of net investment hedges of $5.8 million.
Previous wording
Pentair, Pentair Finance S.à r.l (“PFSA“) and Pentair, Inc. are parties to a credit agreement (the “Senior Credit Facility”), with Pentair as guarantor and PFSA and Pentair, Inc. as borrowers, providing for a $900.0 million senior unsecured revolving credit facility and a $200.0 million senior unsecured term loan facility. The revolving credit facility has a maturity date of December 16, 2026 and the term loan facility has a maturity date of December 16, 2024. Borrowings under the Senior Credit Facility bear interest at a rate equal to an alternate base rate, adjusted term secured overnight financing rate, adjusted euro interbank offered rate, adjusted daily simple secured overnight financing rate or central bank rate, plus, in each case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating.
Current wording
Pentair, Pentair Finance S.à r.l (“PFSA“) and Pentair, Inc. are parties to a credit agreement (the “Senior Credit Facility”), with Pentair as guarantor and PFSA and Pentair, Inc. as borrowers, providing for a $900.0 million senior unsecured revolving credit facility. During 2024, PFSA repaid $200.0 million of term loans under the Senior Credit Facility. The revolving credit facility has a maturity date of December 16, 2026. Borrowings under the Senior Credit Facility bear interest at a rate equal to an alternate base rate, adjusted term secured overnight financing rate, adjusted euro interbank offered rate, adjusted daily simple secured overnight financing rate or central bank rate, plus, in each case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating.
Previous wording
As of December 31, 2023, total availability under the Senior Credit Facility was $900.0 million. In addition, PFSA has the option to request to increase the revolving credit facility and/or to enter into one or more additional tranches of term loans in an aggregate amount of up to $300.0 million, subject to customary conditions, including the commitment of the participating lenders.
Current wording
As of December 31, 2024, total availability under the Senior Credit Facility was $890.5 million. In addition, PFSA has the option to request to increase the revolving credit facility and/or to enter into one or more additional tranches of term loans in an aggregate amount of up to $300.0 million, subject to customary conditions, including the commitment of the participating lenders.
Previous wording
In 2022, Pentair and PFSA entered into a senior unsecured term loan facility (the “Term Loan Facility”), with PFSA, as borrower, Pentair, as guarantor, and the lenders and agents party thereto, providing for an aggregate principal amount of $1.0 billion. The Term Loan Facility has a maturity date of July 28, 2027, with required quarterly installment payments of $6.3 million which began on the last day of the third quarter of 2023 and increases to $12.5 million beginning with the last day of the third quarter of 2024. The Term Loan Facility bears interest at a rate equal to an alternate base rate, adjusted term secured overnight financing rate, or adjusted daily simple secured overnight financing rate, plus, ineach case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating.
Current wording
In addition, Pentair and PFSA are parties to a senior unsecured term loan facility (the “Term Loan Facility”), with PFSA, as borrower, Pentair, as guarantor, providing for an aggregate principal amount of $1.0 billion. The Term Loan Facility has a maturity date of July 28, 2027, with required quarterly installment payments of $6.3 million which began on the last day of the third quarter of 2023 and increased to $12.5 million on the last day of the third quarter of 2024. During 2024, PFSA repaid the remaining $162.5 million of quarterly installments on the Term Loan Facility, such that PFSA is not required to make any further quarterly installment payments. As of December 31, 2024, the remaining obligation of $825.0 million matures on July 28, 2027. The Term Loan Facility bears interest at a rate equal to an alternate base rate, adjusted term secured overnight financing rate, or adjusted daily simple secured overnight financing rate, plus, ineach case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating.
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Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
•increased selling prices to mitigate impacts of inflation; and
Rearranged previous paragraphs (8)
Previous report — wording carried elsewhere
•inflationary cost increases related to labor costs and certain raw materials.
Previous report — wording carried elsewhere
The 28.2 percent increase in net sales for Water Solutions in 2022 from 2021 was primarily the result of:
Previous report — wording carried elsewhere
•decreased sales volume in our residential business in 2022 compared to the prior year; and
Previous report — wording carried elsewhere
•inflationary cost increases related to labor costs and certain raw materials; and
Previous report — wording carried elsewhere
The 1.9 percentage point increase in segment income for Water Solutions as a percentage of net sales in 2022 from 2021 was primarily the result of:
Previous report — wording carried elsewhere
The 17.7 percent decrease in net sales for Pool in 2023 from 2022 was primarily the result of:
Previous report — wording carried elsewhere
•inflationary cost increases related to labor costs and certain raw materials.
Previous report — wording carried elsewhere
Loan Facility provide for the calculation of EBITDA giving pro forma effect to certain acquisitions, divestitures and liquidations during the period to which such calculation relates.