ITT INC

Management reviews a variety of key performance indicators including revenue, operating income and margin, and earnings per share. In addition, we consider certain measures to be useful to management and investors when evaluating our operating performance for the periods presented. These measures provide a tool for evaluating our ongoing operations and management of assets from period to period. This information can assist investors in assessing our financial performance and measures our ability to generate capital for deployment among competing strategic alternatives and initiatives, including, but not limited to, acquisitions, dividends, and share repurchases. Some of these metrics, however, are not measures of financial performance under accounting principles generally accepted in the United States of America (GAAP) and should not be considered a substitute for measures determined in accordance with GAAP. We consider the following non-GAAP measures, which may not be comparable to similarly titled measures reported by other companies, to be key performance indicators for purposes of our reconciliation tables.

•“Organic revenue” is defined as revenue, excluding the impacts of foreign currency fluctuations and acquisitions. The period-over-period change resulting from foreign currency fluctuations is estimated using a fixed exchange rate for both the current and prior periods. We believe that reporting organic revenue provides useful information to investors by facilitating comparisons of our revenue performance with prior and future periods and to our peers.

Reconciliations of revenue to organic revenue for the three and six months ended June 29, 2024 are provided below.

•“Adjusted operating income (loss)” is defined as operating income (loss), adjusted to exclude special items that include, but are not limited to, restructuring, certain asset impairment charges, certain acquisition- and divestiture-related impacts and unusual or infrequent operating items. Special items represent charges or credits that impact current results, which management views as unrelated to the Company’s ongoing operations and performance. “Adjusted operating margin” is defined as adjusted operating income (loss) divided by revenue. We believe that these financial measures are useful to investors and other users of our financial statements in evaluating ongoing operating profitability, as well as evaluating operating performance in relation to our competitors.

Reconciliations of operating income (loss) to adjusted operating income (loss) for the three and six months ended June 29, 2024 and July 1, 2023 are provided below.

(a)Includes income from a recovery of costs associated with the 2020 lease termination of a legacy site.

•“Adjusted income from continuing operations” is defined as income from continuing operations attributable to ITT Inc. adjusted to exclude special items that include, but are not limited to, restructuring, certain asset impairment charges, certain acquisition- and divestiture-related impacts, income tax settlements or adjustments and unusual or infrequent items. Special items represent charges or credits, on an after-tax basis, that impact current results, which management views as unrelated to the Company’s ongoing operations and performance. “Adjusted income from continuing operations per diluted share” (adjusted EPS) is defined as adjusted income from continuing operations divided by diluted weighted average common shares outstanding. We believe that adjusted income from continuing operations and adjusted EPS are useful to investors and other users of our financial statements in evaluating ongoing operating profitability, as well as in evaluating operating performance in relation to our competitors.

Reconciliations of adjusted income from continuing operations attributable to ITT to income from continuing operations attributable to ITT and adjusted income from continuing operations attributable to ITT per diluted share to income from continuing operations attributable to ITT per diluted share (EPS) for the three months ended June 29, 2024 and July 1, 2023 are provided below. Per share amounts are reported in ones and may not calculate due to rounding.

(a)The three and six months ended June 29, 2024 included integration-related expenses and inventory step-up amortization related to the acquisition of Svanehøj. The three and six months ended July 1, 2023 included integration-relation expenses related to the acquisition of Micro-Mode. See Note 18, Acquisitions and Divestitures, to the Consolidated Condensed Financial Statements for further information.

(b)2023 other special items primarily consisted of income from a recovery of costs associated with the 2020 lease termination of a legacy site.

(c)The tax impact of each adjustment is determined using the jurisdictional tax rate of where the expense or benefit occurred.

(d)The three months ended June 29, 2024 included a tax benefit to record a net operating loss deferred tax asset related to a prior year acquisition of $(2.0), tax expense on distributions of non-U.S. income of $1.0, and other tax-related special items of $1.0. The six months ended June 29, 2024 included expense (benefits) from tax on undistributed foreign earnings of $2.4, a tax benefit to record a net operating loss deferred tax asset related to a prior year acquisition of $(2.0), and other tax special items of $1.3.

The three months ended July 1, 2023 included tax expense on distributions of non-U.S. income ($1.2), and other tax-related special items ($0.8). The six months ended July 1, 2023 included benefits from valuation allowance reversals ($17.5) and the amendment of our federal tax return ($4.9), partially offset by a settlement expense related to a tax audit in Italy ($14.3) and tax on future distribution of foreign earnings ($2.9).