PENTAIR
PENTAIR: DIFFERENTIATED GROWTH
PENTAIR INVESTOR & ANALYST EVENT
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Randall J. Hogan Chairman and Chief Executive Officer November 13, 2013
2013 Houston Investor & Analyst Event
PENTAIR: DIFFERENTIATED GROWTH PENTAIR INVESTOR & ANALYST EVENT - - PowerPoint PPT Presentation
PENTAIR: DIFFERENTIATED GROWTH PENTAIR INVESTOR & ANALYST EVENT Randall J. Hogan Chairman and Chief Executive Officer November 13, 2013 1 PENTAIR 2013 Houston Investor & Analyst Event FORWARD-LOOKING STATEMENTS C AUTION C ONCERNING F
PENTAIR
PENTAIR: DIFFERENTIATED GROWTH
PENTAIR INVESTOR & ANALYST EVENT
1
Randall J. Hogan Chairman and Chief Executive Officer November 13, 2013
2013 Houston Investor & Analyst Event
PENTAIR
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FORWARD-LOOKING STATEMENTS
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS This communication 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
"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 successfully integrate Pentair, Inc. and the Flow Control business and achieve expected benefits from the Merger; 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 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 Quarterly Report on Form 10-Q for the quarter ended September 28, 2013 and our 2012 Annual Report on Form 10-K. All forward-looking statements speak only as of the date of this communication. Pentair Ltd. assumes no obligation, and disclaims any obligation, to update the information contained in this communication.
2013 Houston Investor & Analyst Event
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2013 Houston Investor & Analyst Event
KEY DEFINITIONS FOR TODAY’S PRESENTATION
Flow Control for the Full Year
Flow Control for the Full Year
the Impact of Severance, Asset Impairment, Deal-Related, and Other Costs
Please Refer to the Appendices for Reconciliations of Non-GAAP Measures and Pro Forma Results
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AGENDA
1) Strategy Overview & Trends Randy Hogan 8:30 – 9:15 2) Thermal Management Overview Alok Maskara 9:15 – 10:00 3) Valves & Controls Overview David Dunbar 10:15 – 11:00 4) Q&A Leadership Team 11:00 – 11:30 5) Transportation to Pasadena 11:45 – 12:30 6) Pasadena Service Center Tour 12:45 – 2:00
Welcome!
2013 Houston Investor & Analyst Event
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LAST YEAR’S THEME AND KEY MESSAGES
A New Company Building Off Proven Platforms for Success
A Stronger Company More Opportunities Proven Operating Disciplines Setting & Meeting Expectations 1
The New Pentair
2 3 4
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A Stronger Company
Many Indicators of Our Strength
PROGRESS TO DATE …
+ Added to S&P 500 + Share Price up 53% (+31% versus S&P 500) + Recognized in Bloomberg BusinessWeek Top 50 + Recognized Forbes Top 100 Innovators + Two Shingo Silver Medallion Awards in 12 months + 30,000 Employees … Leadership in Key Verticals
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A Successful Year One
PROGRESS TO DATE …
+ Integration Synergies Expected to be $120M in 2013
More Opportunities Proven Operating Disciplines
+ PIMS Aggressively Adopted
+ Solid Financial Returns YTD
Setting & Meeting Expectations
+ Significant Opportunities Remain
2013 Houston Investor & Analyst Event
* All year-over-year comparisons against 2012 adjusted results on a pro forma basis for the Flow Control acquisition. See Appendix for reconciliation of non GAAP measures.PENTAIR
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PENTAIR STRATEGY – CONSISTENT APPROACH
‒ Where We Lead and Can Drive Differentiated Growth ‒ Aligned with Growth Trends
‒ PIMS … One Pentair Culture / Win Right … Aligned Verticals ‒ Targeting Synergies and Base Performance to Deliver ~$5.00 EPS in ’15
‒ Known as World-Class in Lean and Growth ‒ Destination Company for Customers and Top Talent
Continue to Execute These Strategic Imperatives
2013 Houston Investor & Analyst Event
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PENTAIR: A BALANCED & DIVERSE PORTFOLIO
Broad Diversification By Reporting Segment By Vertical
Exposure with 25% in Fast Growth Regions
Strength and Western Europe has Stabilized
Resi/Comm, ~24% Energy, ~28% Infrastructure, ~13% Industrial, ~26% Food & Beverage, ~9%
Water & Fluid Solutions, ~44% Technical Solutions, ~23% Valves & Controls, ~33%
By Geography
U.S. and Canada, ~42% Western Europe, ~18% Fast Growth, ~25% Developed Non-U.S., ~15%
North American Residential and Food & Beverage; Industrial has Stabilized; Energy Mixed
100% = 2012 sales* of $7.3B
Balanced Portfolio
Recognized Brands
Globally
2013 Houston Investor & Analyst Event
*2012 sales. Adjusted results on a pro forma basis for the Flow Control acquisition. See appendix for reconciliation of non GAAP measures.PENTAIR
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KEY GROWTH VERTICALS
Leveraging Global Mega Trends
Networks
Leisure
*2012 sales. Adjusted results on a pro forma basis for the Flow Control acquisition. See appendix for reconciliation of non GAAP measures. ** PNR estimates.~28% ~26% ~9% ~13% ~24%
% of Sales*
~4-6% ~2-3% ~6-8% ~Flat ~5-8%
Long-Term Growth Rate**
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OUR SUCCESS
Positioned Well to be the Next Great Industrial Company
Cultural Transformation… Energized and Committed Our Strategies are Working… 2013 a Great Example Trends in Our Favor… Must Seize Opportunities A Stronger Portfolio… Global Leadership New Growth Framework… to Drive More Organic Growth
2013 Houston Investor & Analyst Event
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OUR SUCCESS
Positioned Well to be the Next Great Industrial Company
Cultural Transformation… Energized and Committed Our Strategies are Working… 2013 a Great Example Trends in Our Favor… Must Seize Opportunities A Stronger Portfolio… Global Leadership New Growth Framework… to Drive More Organic Growth
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High Performance Co.
Today +
Operating Co.
2001 - 2012
Holding Company
1966 - 2000
Strong Execution
—Exited Tools —Expanded in Water —Added Energy
—Lean / Ops Excellence —Growth (3D / RGP) —Talent Management
COMPANY TRANSFORMATION ~ 45+ YEARS
Executing on Strategies Profoundly Changed Company
Maximizing PIMS
Regions and Verticals
Leadership Driving Growth
Technical Products Company
Start
Businesses
Financial Metrics
Industrial Company
$1B
$4B >$13B
Market Cap
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ROBUST STANDARD OPERATING MODEL
Talent Management
Our Global Talent Process to Select, Develop, and Retain Top Talent
Lean Enterprise
The Way We Drive Value to Our Customers Throughout All Our Business Processes by Reducing Waste and Improving Speed and Efficiency
Pentair Integrated Management System
Proven Operating Disciplines Rapid Growth Process
The Tools and Language to Drive Above-Average Growth Consistently
3D Process for Innovation
Works in Concert with Rapid Growth to Bring New Products to Market Through Three Key Phases:
Growth
2013 Houston Investor & Analyst Event
PENTAIR
36% 146% 156% 164% 187% 198% 244% 265% 341% 472% 655% 705% 1324%
S&P 500 EMR MidCap 400 HON MMM DOV ITW UTX DHR ETN PNR ROP AME 15
(1/1/2001 to 11/07/2013)
Pentair Performance is Firmly in the Upper Quartile
’01 – ‘13 TOTAL STOCK RETURN AGAINST SELECT INDUSTRIALS
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TRANSFORMATION … MORE GLOBAL
Portfolio Diversification to “Control Destiny “ $2B 2001 $7.4B 2013F $8.4B 2015T
U.S.
80% 15%
Other Dev. Fast Growth
5%
~40% ~35% ~25% 27%+ ~33% ~40%
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2012 2013F 2015T
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FAST GROWTH REGIONS
Current Strength
Execute on Vision to Make Fast Growth Regions Work
Focus Areas For Growth
Developed Fast Growth
$7.3B ~$7.4B
$5.6B ~$5.7B $1.7B ~$1.8B
Energy = Middle East …
Collaboration
$8.4B+
$6.1B+ $2.3B+
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STANDARDIZATION
Significant Savings Opportunity in Operating Expenses G&A Reductions Through Lean Enterprise to Fuel Growth Key Synergy Initiatives: ~$175M Funnel
Drop ~200 basis points 2013 to 2015
Standardization Targets for 2014, 2015 and Beyond: − Major Repositioning − Aggressive ERP and Back-office Consolidations (Most Savings 2014+) − G&A: From 8% of Sales to 6% (Legacy PNR Businesses are Under 4%) − ERP: Reduce from ~66 to ~16 − Reporting Entities Reduced by 65% − Other: Reduce Payroll / Acctg. Centers
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2012 2013F 2015T ~20% ~22% >22% Opex.
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MARGIN EXPANSION
2012 2013F 2015T
Robust Margin Expansion Highlights Execution Capabilities Operating Margins
Key Drivers 2012 2013
Pricing Cost Productivity Standardization
Expanding Margins
− Execute on Pricing Management − Targeting >1% of Sales
− PIMS: Rapid Adoption / Implementation − Growth While Leveraging Structure − Productivity > Inflation & Mix
− $90M Cost-Out in 2013 − 2 Points of G&A Reduction Targeted by 2015 − Reduce Complexity and Continue Functional Standardization
~11% ~13% >16%
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OUR SUCCESS
Positioned Well to be the Next Great Industrial Company
Cultural Transformation… Energized and Committed Our Strategies are Working… 2013 a Great Example Trends in Our Favor… Must Seize Opportunities A Stronger Portfolio… Global Leadership New Growth Framework… to Drive More Organic Growth
2013 Houston Investor & Analyst Event
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OUR FUTURE: POSITIONING FOR DIFFERENTIATED GROWTH
Driving Core Important … But Must Pursue Differentiation
2013 Houston Investor & Analyst Event
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CURRENT TRENDS
US: Steady Recovery (Bright Spot) + Housing Back Strong + Petrochemical Opportunity – Fiscal Uncertainty
Developed Regions Fast Growth Regions
Europe: Could Be Good Growth + Stabilizing Now + Could Surprise to Upside – Difficult Decisions Ahead FGR: Mixed but Slowed in ’12 & ’13 + China 5-yr Plan Attractive +/– China Slow but Still Important – India, Brazil Bouncing Around Resource Rich: Infrastructure Build + Significant Energy Investment + Adding Lots of Jobs – Mining Slow … For Now In Position to Take Advantage of Trends U.S. Housing Remains Strong and Europe Improving Continuing to Add Talent to Key Growth Regions PIMS Executes on Our Strategies Aggressively
Generally Good-To-Improving Environment
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THE TRENDS INFORMING OUR STRATEGIC THINKING
Driven by the “New-New” World The Nexus of Demands Driving “Food – Water – Energy”
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GROWTH* OVER THE NEXT TWO DECADES
Today: 7B
9B
World’s Population Today: $50T
$110T
World GDP More than Doubles Today: $20T
$60T
Middle Class Purchasing Power Triples Today: ~55%
75%
Population in APAC & Africa Today: 2B
5B
Global Middle Class Today: 5 out of 10
7of10
People Living in Urban Areas
Drives Much of Our Thinking and Strategy
2013 Houston Investor & Analyst Event
* PNR EstimatesPENTAIR
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PENTAIR: POSITION TO BENEFIT
Well Positioned
FOOD WATER ENERGY
+ Ag Pumps / Spray + Aquaculture + Food & Bev Process + Food Service
+ Global Pump + Global Filtration + Flood Control + Advanced Systems
+ Leader in Valves + Leader in Thermal + Separations Technology + Service Model
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PENTAIR
3 Reporting Segments
ORGANIZING FOR SUCCESS – CURRENT ALIGNMENT
Platforms are Where We Serve Customers … GBU’s + ELT Aligned to Improve Growth and Productivity Trajectory
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Water & Fluid Solutions Valves & Controls Technical Solutions
Executive Leadership Team (ELT)
Aquatic Systems Equipment Protection Thermal Management
7 Global Business Units
Filtration & Process Flow Technologies WES Valves & Controls
24 Operating Platforms
Standard Pumps Engineered Pumps Fluid Motion Advanced Filtration Electrical/Cooling Aquaculture Ag Spray Pool Oil & Gas Separation F & B Processing Water Purification
Actuation & Controls
Food Service Quarter Turn Electronics Pressure Relief Gate, Globe, & Check Water Services Mega-Projects Water Transmission Water Dynamics Clean Air Systems
CEO + COO + CFO + Growth + HR + Legal/Compliance
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ALIGNING PLATFORMS TO DRIVE GROWTH
Platforms Aligned with Key Growth Verticals
FOOD & BEVERAGE
F & B Processing Food Service Aquaculture Ag Spray
RESI & COMMERCIAL
Fluid Motion Water Purification
Standard Pumps Pool
ENERGY
Quarter Turn Gate, Globe, & Check
Mega-Projects Water Transmission Electrical/Cooling Oil & Gas Separation Actuation & Control Pressure Relief
INDUSTRIAL
Actuation & Control Quarter Turn Gate, Globe, & Check Electrical/Cooling Water Services Clean Air Systems Advanced Filtration
Pressure Relief
INFRA- STRUCTURE
Advanced Filtration Water Dynamics Electronics Engineered Pumps Water Transmission
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MAINTAINING LEADERSHIP IN ENERGY
Pentair’s Capabilities and Solutions
WAYS TO WIN
1 2 4 3 5 Product Innovation for Critical Applications – Sub-sea, Cryogenic Expanded Solutions & Service Offerings – HRT, HIPPS, Rentals Fast Growth Region Expansion – Mid-East, China, Russia / CIS, Africa Global Strategy Serving Local Needs PIMS … Best in Class Quality, Delivery, and Standardization
2013F: ~$2.1B ~75% Direct Sales ~25% Indirect Sales ~225 Sales Engineers ~600 Distributors
Actuation & Control Electrical/Cooling Oil & Gas Separation
Quarter Turn Pressure Relief Gate, Globe, & Check Mega-Projects Water Transmission
2013 Houston Investor & Analyst Event
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EXPANDING OFFERINGS IN INDUSTRIAL
Led by North American Industrial Recovery
2013F: ~$1.9B ~55% Direct Sales ~45% Indirect Sales ~300 Sales Engineers ~2000 Distributors
WAYS TO WIN
1 2 4 3 5 Expanded Service Offerings – Cooling Audits, Plant Services Fast Growth Region Expansion – Russia, Middle-East, China Maximize NA Distribution Channels Product Innovation for Severe Service Applications PIMS … Best in Class Quality, Delivery, and Standardization
Water Services Clean Air Systems
Pressure Relief Actuation & Control Quarter Turn Gate, Globe, & Check Electrical/Cooling Advanced Filtration
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MAINTAINING LEADERSHIP IN RESIDENTIAL & COMMERCIAL
Taking Advantage of Residential / Commercial Recovery
WAYS TO WIN
1 2 4 3 5
2013F: ~$1.9B ~5% Direct Sales ~95% Indirect Sales ~500 Sales Engineers ~1200 Distributors
Fast Growth Region Expansion – Middle East & Southeast Asia Led by the US Residential Recovery Expand Eco-Select Offerings and Execute Hybrid DI Product Innovation – Energy Efficiency PIMS … Best in Class Quality, Delivery, and Standardization
Standard Pumps Fluid Motion Pool Water Purification
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ESTABLISHING LEADERSHIP IN INFRASTRUCTURE
Selectively Choose Where to Play
WAYS TO WIN
1 2 4 3 5
2013F: ~$1B ~70% Direct Sales ~30% Indirect Sales ~200 Sales Engineers ~900 Distributors
Fast Growth Region Expansion – Middle East, SE Asia, Africa Global Flood Control Leadership More Systems / Solutions With Our Products Establish Membrane Technology Leadership – Nano Filtration PIMS … Best in Class Quality, Delivery, and Standardization
Engineered Pumps Advanced Filtration Electronics Water Dynamics Water Transmission
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EXPANDING LEADERSHIP IN FOOD & BEVERAGE
Food & Bev Offers the Fastest Growth for Pentair
WAYS TO WIN
1 2 4 3 5
2013F: ~$700M ~60% Direct Sales ~40% Indirect Sales ~40 Sales Engineers ~60 Distributors
Fast Growth Region Expansion – Lead in Africa Aquaculture Leadership Globalize Agriculture Strategy Application Expertise – Breweries, Dairy, etc. PIMS … Best in Class Quality, Delivery, and Standardization
Aquaculture Ag Spray Beverage Systems F & B Processing
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OUR CURRENT LANDSCAPE – FAST GROWTH REGIONS
We Have Real & Global Capabilities
China Africa India Middle East Eastern Europe Latin America
$360M 3,340 6
South East Asia
$350M 1,150 2 $200M 65
2,860 6 $200M 400 2 $100M 1,340 4 $100M 60 1
Total FGRs - Additional Info:
Sales & Mktg Headcount R&D Headcount # of Distributors & Agents 950 350 1,100
Legend: 2013F Ship-to-Sales Headcount Manufacturing Sites
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FOCUS AREAS – BIG BETS
Several Ways To Win … Increasing Odds by Prioritizing
RESI & COMMERCIAL INFRA- STRUCTURE ENERGY INDUSTRIAL FOOD & BEVERAGE
= Priority / Focus Area
China Middle East Brazil / LAM India SEA Eastern Europe Africa
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FOCUS AREAS – ADDITIONAL PRIORITIES
… Without Forgetting the Other Nice Opportunities
China Middle East Brazil / LAM India SEA Eastern Europe Africa
RESI & COMMERCIAL INFRA- STRUCTURE ENERGY INDUSTRIAL FOOD & BEVERAGE
= Priority / Focus Area = Opportunity / Core
2013 Houston Investor & Analyst Event
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OUR SUCCESS
Positioned Well to be the Next Great Industrial Company
Cultural Transformation… Energized and Committed Our Strategies are Working… 2013 a Great Example Trends in Our Favor… Must Seize Opportunities A Stronger Portfolio… Global Leadership New Growth Framework… to Drive More Organic Growth
2013 Houston Investor & Analyst Event
PENTAIR
STRATEGY
PENTAIR … DRIVING HIGH PERFORMANCE
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A L I G N M E N T
HOW WE DIFFERENTIATE PENTAIR
HOW WE EXECUTE
HOW WE WIN RIGHT
Three Levers … Aligned To Achieve Our Goals
PROCESS & STRUCTURE CULTURE & TALENT
2013 Houston Investor & Analyst Event
PENTAIR
30,000 People Understand “What”, “How” and “Why”
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PENTAIR … WHAT WE STAND FOR
HOW WE MAKE A DIFFERENCE IN THE WORLD HOW WE ACHIEVE OUR VISION HOW WE WIN RIGHT Purpose
We Improve the Quality of Life of People Around the World
Mission & Vision
Be the Next Great Industrial Company
Destination Company for Customers, Top Talent, & Shareholders
Strategic Principles
— “Right-To-Left” Thinking & Actions — Positioning to Win
Operating Principles … PIMS
WIN
Customer First Accountability for Performance Innovation and Adaptability
RIGHT
Positive Energy Respect and Teamwork Absolute Integrity
2013 Houston Investor & Analyst Event
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ORGANIZING FOR SUCCESS – NEW ALIGNMENT
Simplified & Aligned to Drive Growth & Productivity
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Executing Growth & Productivity of Prioritized Platforms
5 Global Business Units
Executing the PNR Priorities as Strategic and Operating Leaders
Executive Leadership Team CEO + Executive Officers + Presidents = Aligned Priorities & Agenda
Technical Solutions
Alok Maskara
~$1.7B* Valves & Controls
David Dunbar
~$2.4B* Filtration & Process
Netha Johnson
~$1.1B* Aquatic Systems
Karl Frykman
~$0.7B* Flow Technologies
Phil Pejovich
~$1.7B*
4 Executive Officers Driving PNR-Wide Lean Enterprise
John Stauch/CFO/IT
Driving G&A Transformation
Todd Gleason/Growth
Driving Marketing, Strategy, and Sales Excellence
Fred Koury/HR
Global Talent Management
Angela Lageson/Legal
Global Compliance & Legal
ERP’s, Lean Enterprise, and Financial Performance Aligned and Prioritized Strategies for Growth Deployment of Top Talent Against Most Important Priorities Ensuring Global Compliance
2013 Houston Investor & Analyst Event
* Estimated 2013 sales.PENTAIR
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VALUE CREATION: 2015 GOALS
Road Map to ~$5.00 EPS Goal
~$2.73 ~($0.21) ~$2.52 ~$1.80 ~$0.68 ~$5.00
2012* Pre-Deal 2012* Pro Forma Impact 2012* Pro Forma Performance Capital Allocation 2015 Goal
~$0.80 ~$1.00
IST Base
* 2012 adjusted results and 2013 guidance on an adjusted pro forma basis, see appendix for reconciliation of non GAAP measures.2013 Houston Investor & Analyst Event
PENTAIR 2013 Houston Investor & Analyst Event
THERMAL MANAGEMENT
PENTAIR INVESTOR & ANALYST EVENT
Alok Maskara President, Pentair Thermal Management November 13, 2013
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PENTAIR 2013 Houston Investor & Analyst Event
KEY MESSAGES
and has Mega Project Upside
Accelerate Margin Expansion Thermal: Proud to be Part of Pentair!
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PENTAIR 2013 Houston Investor & Analyst Event
WE PROTECT PIPES FROM FREEZING
Where We Began and Our #1 Application
Sometimes Solving Simple Problems …. but Mostly Solving Difficult Challenges
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PENTAIR 2013 Houston Investor & Analyst Event
HEAT TRACING: HOW WE PROTECT PIPES
Heat Tracing Maintains Temperature of Fluids by Replacing Heat Lost Through Thermal Insulation
Associated Equipment
Heat-trace Panel (may include circuit breakers, controllers and alarms) Transformer Lighted End Seal Remote Configuration And Monitoring with DigiTrace Supervisor software Insulation Systems Power Connection Heating Cable
Pentair Thermal Provides Complete Solution to Customers
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PENTAIR 2013 Houston Investor & Analyst Event
Product Quality Portfolio to Meet Customer’s Need Innovative Technology Product Reliability Ease of Use
OUR VALUE PROPOSITION
Leading Product Attributes Global Field Service Network Customer Service Product Brand – Raychem Service Brand – Tracer
A Leader in Brand Equity, Product Quality, Innovation, and Service
Leading Service and Brand Reputation
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PENTAIR 2013 Houston Investor & Analyst Event
North America Fast Growth Regions Developed Non-NA Heat Tracing & Specialty Cables Control, Monitoring, & Sensing Services
BUSINESS OVERVIEW
Attractive Growth Portfolio
Receive “Warm Pipe Guarantee”
Expands Our Core Product
Cables Remains Our Core Product
Driven by Oil Sands and Bakken
by Russia, China, Indonesia
by Scandinavia & Offshore
Natural Gas Price Dynamics
Applications and Luxury Needs
By Vertical
Oil & Gas Chemical Commercial & Residential Power Other
By Product / Service By Geography
Energy – Oil & Gas Industrial – Chemical Residential & Commercial Energy – Power Other
100% = ~$0.7B* 100% = ~$0.7B* 100% = ~$0.7B*
* 2013 estimated sales.46
PENTAIR 2013 Houston Investor & Analyst Event
Advanced Industrial Solutions Building & Infrastructure Solutions Mega Projects
THERMAL: GO-TO-MARKET OVERVIEW
Broad and Diversified Portfolio
By Sub Platforms
‒ Oil & Gas 60%, Chemical 20%, Other Industrial 20% ‒ Green Field 30% vs. MRO 70% ‒ EPC 20%, EP 50%, P only 30%
‒ Commercial 50%, Infra 30%, Resi 20% ‒ Mostly Product Only Sales
‒ Oil & Gas Projects that are $100M+
Direct Sales Indirect (Distributors, Wholesale)
By Channel
is Our Typical Go-to-Market Approach
are Used for Harder to Reach End Users Such as Light Commercial and Fast Growth Regions
100% = ~$0.7B* 100% = ~$0.7B*
* 2013 estimated sales.47
PENTAIR 2013 Houston Investor & Analyst Event
Strong Industrial and Refining Position with Opportunities in Mid/Upstream
THERMAL: ADVANCED INDUSTRIAL SOLUTIONS
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PENTAIR 2013 Houston Investor & Analyst Event
EXAMPLE: QATARGAS SULPHUR TRANSFER LINE
– 35Km, Dual, 12-inch Sulphur Pipeline to Transfer Molten Sulphur from 11 Producers to a Pelletizer Facility – Temperature Maintain at 135 C with Tight Allowable Range from 125 C to 145 C
Engineering, Procurement, Construction, and Commissioning
Includes Fiber Optic Temperature Sensing
Services and Leak Detection
A World Leader in Heated Sulphur Pipelines
Sulphur flow simulation
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PENTAIR 2013 Houston Investor & Analyst Event
THERMAL: BUILDING & INFRASTRUCTURE SOLUTIONS
Building & Infrastructure Solutions: Utilizing Pentair Channels
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PENTAIR 2013 Houston Investor & Analyst Event
EXAMPLE: BEIJING CAPITAL AIRPORT
– 48Km of Heat Tracing to Prevent Snow and Ice from Forming on the Guideway and Running Surfaces of the Automated People Mover
– Heating System Design, Specification, and Material Supply
Snow Melting System for Tracks
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PENTAIR 2013 Houston Investor & Analyst Event
KEY MESSAGES
and has Mega Project Upside
Accelerate Margin Expansion Thermal: Proud to be Part of Pentair!
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PENTAIR 2013 Houston Investor & Analyst Event
ATTRACTIVE MEGA TRENDS
(Oil Sands, Africa, Russia, etc.) Needs Heat Tracing
Climate Requires Heat Tracing
Increasing Petrochemical Investments
Energy
in Colder Climate (North China, Russia / CIS)
Demand for Fire Alarm and Fire Sprinkler System Protection
Heating Continues (Electric Small Areas / Hydronic Large Areas)
Driving Demand for Gutter Freeze Protection and Hot Water Temperature Applications
Quality of Life
Pushing More Customers Towards Electrical Heat Tracing vs. Steam
Driving Growth of More Accurate Wire Based Leak Detection Technology
Environment Global Trends Contribute to Thermal’s Growth Outlook Infrastructure
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PENTAIR
ADVANCED INDUSTRIAL SERVICES LANDSCAPE(TAM)
20 40 60 80
PTM 129 A 108 B 70
C 30 Larger Regional Providers 100 Small Regional Providers 713 P TM 74A 35
Small Regional Providers 191 PLC/DCS Sy stem Provi ders 100Small Regional Providers 922 J 818 K 90 Electric & Steam HT Services Other EPCs, Electrical & Mechanical Contractors 11,950 $13,950M
100%
Heat Tracing & Specialty Wiring$1,150M
Control, Monitoring &Sensing$400M Steam Products $2,000M
Total = $17,500M
AIS Business More Global in Nature than BIS
Product TAM = $3.5Bn Services TAM = $14.0Bn
Pentair Thermal Management
2013 Houston Investor & Analyst Event
Source: PNR Estimates54
PENTAIR
BUILDING & INFRASTRUCTURE LANDSCAPE (TAM)
Highly Fragmented, Services Led By Regional Players
Electric TAM = $3.4Bn Hydronic TAM = $6.1Bn
20 40 60 80 100%
Heat Tracing & Specialty Wiring N 96O 85
Q 42 A 30 S 30 T 30 U 20 LDetection 20Small Regional Providers 497
$1,020M
Control, Monitoring & SensingPTM 64
N 64O 65
Q 10W 40
Small Regional Providers 375$680M
Electric ServicesRegional System Designers 300
Regional Installers 900
Global System Designers 150 Global Installers 350$1,700M
Hydronic Product
P 650 V 370 Larger Regional Providers 500 Small Regional Providers 1,530 $3,050M
Hydronic ServicesHydronic Service Providers 3,050 $3,050M
Total = $9,500M
2013 Houston Investor & Analyst Event
Source: PNR EstimatesPentair Thermal Management
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PENTAIR 2013 Houston Investor & Analyst Event
KEY COMPETITORS
Fragmented Industry Structure
Building & Infrastructure Solutions Advanced Industrial Solutions
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PENTAIR 2013 Houston Investor & Analyst Event
BROAD AND DIVERSIFIED CUSTOMER BASE
Top 20 Customers Make up Only 30% of Total Revenues
41 42.3 Top 20 Customers Total Customer BaseGross Margin Average %*
Top 20 Customers by Geography
Canada APAC FGR US
Top 20 Customers by Type
Oil & Gas EPC Distributors
Top 20 Customers ~30% Remaining 1000+ Customers ~70%
* 2013 estimate57
PENTAIR 2013 Houston Investor & Analyst Event
KEY MESSAGES
and has Mega Project Upside
Accelerate Margin Expansion Thermal: Proud to be Part of Pentair!
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PENTAIR 2013 Houston Investor & Analyst Event
2011 2012 2013F 2015T 2011 2012 2013F 2015T
+ mega projects + mega projects
THERMAL: PERFORMANCE OVERVIEW
Strong Earnings Increase, Steady Base Business Growth
Drivers of 6% Anticipated Future Growth
Future Margin Growth: Operational Excellence
Reduction in the Next 3 Years Sales ($M) Operating Income ($M)
ROS
10.5%
656
~6-10%
Mega Mega
669 637 735+ 67
87
105 150+
13% 16% 20.5%
59
PENTAIR 2013 Houston Investor & Analyst Event
2012 2015T
Innovation
THERMAL: 2012 – 2015 GROWTH DRIVERS
RGP Driven Detailed Growth Playbook
Key Drivers
Key Drivers
Key Drivers
and Sensing
2012 2015T
Fast Growth Regions
2012 2015T
Services
Revenue Revenue Vitality
$105M $80M $70M
60
PENTAIR 2013 Houston Investor & Analyst Event
THERMAL GLOBAL FOOTPRINT
Our Strength: 50+ Global Sales & Service Centers
Pentair Service Center Example: Fort McMurray
– Currently Shared with Pentair Valves & Controls – Future Opportunity for Water & Fluid Solutions
THERMAL GLOBAL FOOTPRINT
61
PENTAIR 2013 Houston Investor & Analyst Event
FAST GROWTH REGIONS: RUSSIA / CIS EXAMPLE
Broad Coverage, Strong Growth
Tuymen5.1 5.7 5.4 12.4 16.2 25.6 18.4 23.7 34.5 39.1 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 Revenue ($M)
62
PENTAIR 2013 Houston Investor & Analyst Event
HIGHLIGHTS OF POTENTIAL PROJECT FUNNEL
Actively Pursuing Global Projects
Goliat – Korea / Norway Goliat – Korea / Norway Bayer Golden Tiger - China Bayer Golden Tiger - China Seadrill MOSS CS60 - Singapore Seadrill MOSS CS60 - Singapore NWR - Canada NWR - Canada Fort Hills - Canada Fort Hills - Canada Chevron Gorgon - Australia Chevron Gorgon - Australia
50k bbd Refinery Near Edmonton Sanctioned in 2012 Suncor Operated Mine with 160k bpd Bitumen Froth Capacity Marine LNG Offloading Facility. Liquid Fuel and Water Leak Detection Opportunity Korean Built Floating Production, Storage and Offloading Facility for Barents Sea. Pentair Supplied Heat Tracing and Anti-Icing/De-Icing Heat Management System for Expansion at Bayer Material Science Facility in the Shanghai Chemical Industry Park Winterized Semi-Submersible Drilling Rig Built in Singapore for North Atlantic Deployment. Includes Heat Tracing, Anti-Icing and De-Icing
63
PENTAIR 2013 Houston Investor & Analyst Event
KEY MESSAGES
and has Mega Project Upside
Accelerate Margin Expansion Thermal: Proud to be Part of Pentair!
64
PENTAIR 2013 Houston Investor & Analyst Event
ONE PENTAIR: INTEGRATION UPDATE
India Office Consolidation China Plant Consolidation
GBU Meeting or Exceeding IST Targets
Thermal Site at Legacy Pentair Brazil Moscow Office Consolidation Redwood City Lean Transformation Control Panel Insourcing: Hoffman
$400K Annual Savings + Growth $2M Savings in 2014 Secured $4.8M Petrobras Order $500K Annual Savings Plus Growth $~4M Lean Savings in 2013 Eliminated One Shift with Same Output $2M+ Annual Sales Synergies
65
PENTAIR 2013 Houston Investor & Analyst Event
Scrap Before Scrap Now
PIMS LEAN EXAMPLE: SCRAP REDUCTION
Key Actions: PIMS Playbook
Transformation Plan for Scrap Reduction
Opportunities
Ways to Reduce Wire Scrap
Process Improvement Recommendations
Management to Ensure Sustainability
Causes of Wire Breaks (Six Sigma Project) - Addressed Mechanical Defect in Braider
Lowering Our Scrap Costs … One Initiative at a Time
66
PENTAIR 2013 Houston Investor & Analyst Event
PIMS EXAMPLE: REDUCING MATERIALS COSTS
Seal Products with Brighter LEDs and Unique Lens
Performance and Durability
Delivering 5%+ Net Material Savings this Year … Strong Funnel for Future Years
Indirect Materials Savings Direct Materials Savings
Pentair Rate
Pentair Renegotiated Contracts
and Better Rates
Including Office Supplies, Temporary Labor, etc.
$1+M Savings in 2013
Rapid Negotiations Value Engineering
Polymers by On-Boarding Alternate Suppliers and Consolidating Purchases
Leveraging Pentair Metals’ Expertise
Strategic Sourcing
Improve Costs, Quality, and JIT Delivery
Fabrication Costs. Qualify Alternates
$5+M Savings in 2013
67
PENTAIR 2013 Houston Investor & Analyst Event
PIMS RGP – NAM MRO SERVICES EXAMPLE
Alpha Test Underway
Plants in the Gulf Coast Region to a Combination of Small to Large PTM & Competitive Installations through Direct Channels to Plant / Maintenance Managers
(2010)
Concept
68
PENTAIR 2013 Houston Investor & Analyst Event
Product Overview
Temperature on the Outer Portion of the Heated Section as Compared to the Standard Alloy 825 MI Heating Product
Constructible Designs at a Premium Material Price that is Off-Set by Reductions in Field Installation Labor and On-Going Maintenance Costs
Deploy Develop Discover
Pre-Charter Complete Charter Complete Start Development Complete Prototype (3P) Final Design Freeze Complete Commercialization Plan Complete Product & Process Validation Launch (Jan/2014)
3D Project Status
PIMS 3D INNOVATION: LOW SHEATH TEMPERATURE MI
Enhancing Technology Differentiation
Sectional view of Design D LST MI cable
69
PENTAIR 2013 Houston Investor & Analyst Event
PIMS: HIGH PERFORMANCE “WIN RIGHT” CULTURE
Quick Adoption of Pentair Values
POSITIVE ENERGY We Display a Positive Outlook at All Times ABSOLUTE INTEGRITY We are Committed to Honest and Ethical Business Practices RESPECT AND TEAMWORK We Treat Others With Respect / We Collaborate for Team Success CUSTOMER FIRST We Make it Easy for Customers to Do Business With Pentair ACCOUNTABILITY FOR PERFORMANCE We Commit to High Standards
INNOVATION AND ADAPTABILITY We Adapt to Changing Circumstances and Excel at Applying New Ideas
NPS Strategy Deployment 3 D Key Leadership Criteria Feedback & Coaching Code of Business Conduct & Ethics
70
PENTAIR 2013 Houston Investor & Analyst Event
KEY MESSAGES
and has Mega Project Upside
Accelerate Margin Expansion Thermal: Proud to be Part of Pentair!
71
PENTAIR
VALVES & CONTROLS
PENTAIR INVESTOR & ANALYST EVENT
David Dunbar President, Pentair Valves & Controls November 13, 2013
72
2013 Houston Investor & Analyst Event
PENTAIR
KEY MESSAGES
73
Valves & Controls Positioned to Deliver Superior Value
High Demand, Fragmented Segment
— Breadth of Offering — Superior Application Expertise — Strong Global Presence — Project and Aftermarket Opportunities
— Organic Revenue Growth — Operation Improvements (PIMS) — Simplification and Standardization (Lean Enterprise)
2013 Houston Investor & Analyst Event
PENTAIR
74
WE CONTROL FLOW
We are a World Leader in Valves and Controls
74
ACTUATOR: The Muscles A Mechanical Device Used to Open and Close a Valve CONTROLS: The Brains Instruments Used to Monitor, Control, or Diagnose a Valve and Actuator Package VALVE: The Bones A Mechanical Device that Controls the Flow of a Liquid, Gas, or Vapor in a Piping System
2013 Houston Investor & Analyst Event
PENTAIR
VALVES—CRITICAL TO GLOBAL INFRASTRUCTURE
Our Products Enable Safer, More Efficient, and More Sustainable Operations
From Oil & Gas Upstream Applications in FPSO Vessels that are 6X Larger than an Aircraft Carrier… … to Relief Valves Being the Last Line of Defense Preventing Catastrophic Equipment Failure in Nuclear Power Plants … and Control Valves in Supercritical Steam Power Plants to Meet the Ever Increasing Electricity Demand in the Emerging World … to High Integrity Isolation Valves at an Alumina Refinery with Highly Caustic, High Temperature Fluids Isolation Valves for Liquid Natural Gas Terminals Operating at Extremely Low Temperatures of -320 F Zero Leakage Valves Preventing Escape of Hazardous Gases Like Phosgene in Petrochem Plants
75
Valves are Highly Critical Components for Energy and Industrial Infrastructure
75
2013 Houston Investor & Analyst Event
PENTAIR
– Sizes Range from 1 Inch to 7 Feet in Diameter – Weights from Ounces to Over 30 Tons – Operate from -370 F to Over 1,100 F – Are Installed on Every Continent on the Planet
Fasani Gate Valve
Petrochemical Plant
VALVES & CONTROLS FAST FACTS
V&C Offers Significant Experience in a Broad Array of Solutions
76
FCT Ball Valve
2013 Houston Investor & Analyst Event
* 2013 estimated sales.PENTAIR
SEGMENT CHARACTERISTICS
Diversified Industry and Geographical Presence
77 Oil & Gas Mining Power Chemical Other Process Middle East ROW
Latin America
China India Europe Next 10 Competitors Other Competitors Other Local & Regional Competitors PVC
2013 Houston Investor & Analyst Event
Applications
/ Majors
Expertise
Large Installed Base and Aftermarket Activity
New Infrastructure to Support Growth
Competitors; Limited Reach and Range
Valve Manufacturers Industry Geography
100% = ~$38B 100% = ~$38B 100% = ~$38B
PENTAIR
KEY TRENDS
Overall Trends Favorable for Strong Growth
CUSTOMER TRENDS INDUSTRY TRENDS DEMAND TRENDS
+ Increasingly Harsh Operating Environments + Increasing Global Coordination of Large Complex Projects + Growing Focus on Safety + Tightening of Environmental Regulations ‒ Increasing EPC Competition + Oil & Gas Growth at Record Levels + Growth in NA Petrochemical + Power Industry Seeing Coal to Gas Transition + Power Growth in Middle East / Asia ‒ Mining Investment Slowing in the Short Term + Increasing Population and Growing Middle Class Resulting in Greater Demand for Energy and Power
Total Primary Energy Demand
Source: World Energy Outlook 2012 Presentation by Dr. Fatih Birol, IEA Chief Economist.Mtoe
Source: Citi, JPMorgan, Jefferies, UBS, Morgan Stanley, Deutsche Bank, Bloomberg, BMI78
2013 Houston Investor & Analyst Event
PENTAIR
23 25 30 32 36 34 30 36 38 38 40 42 44
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
GROWTH DYNAMICS ARE EXPECTED TO BE SOLID
Forecasting Moderate Growth Through Next 3 Years
Valves has Grown ~5% CAGR Since 2004
Decline of 15%
Growth Through 2016 – Continued Demand for Critical Infrastructure in Developing Markets – Marginal Strengthening in Developed Economies – Increased Project Investments after Minor Slowdown in 2013 CAGR 5% CAGR Global V&C Total Addressable Market (TAM)
$ Billions
Source: EIF 2012, PNR Estimates2013 Houston Investor & Analyst Event
79
PENTAIR
CONSISTENT THROUGH THE CYCLE GROWTH
A Result of Product and Industry Breadth
80
$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Pentair V&C Sales
6.3% CAGR Through the Cycle
2013 Houston Investor & Analyst Event
$M
PENTAIR
20 40 60 80 100%
Pentair Others Pentair Others Pentair Others Pentair Others
PentairOthers
VALVES USE ACROSS INDUSTRIES
Pentair is a Leader in Targeted Industry Segments
Source: EIF 2012, PNR Estimates81
Opportunities Through Share Gain and Acquisitions
2013 Houston Investor & Analyst Event (Includes Water, Food & Beverage, Pulp & Paper, HVAC, Marine, etc.)
Oil & Gas Mining Power Chemical
PENTAIR 2013 Houston Investor & Analyst Event
VALVES PROCUREMENT IN PROJECT CYCLE
Valves Procured Late in Large Capital Projects
Long Cycle
System
“Mid Cycle”
Valves
Instruments Short Cycle
Instruments
FEED Detailed Design Construction and Installation PRE-FEED Equipment Ordering Project Approval Start-Up Project Approval to Start-up Time in Months
~12-36 Months from
Project Approval to Valves Orders Operation
82
PENTAIR
CUSTOMER REQUIREMENTS
Customers Value Better Products
83
32% 13% 13% 9% 9% 8% 7% 5% Valve Performance Lead Time On-Time Delivery Ease of Maintenance Sales Support Technical Support Brand After-Market Service
Customer Key Buying Criteria*
Valve Performance Defined:
Outside the Pipe) Better Performance Provides:
Performance
*Non-price attributes Source: PV&C market research 2013 Houston Investor & Analyst Event
PENTAIR
KEY MESSAGES
84
Valves & Controls Positioned to Deliver Superior Value
High Demand, Fragmented Segment
— Breadth of Offering — Superior Application Expertise — Strong Global Presence — Project and Aftermarket Opportunities
— Organic Revenue Growth — Operation Improvements (PIMS) — Simplification and Standardization (Lean Enterprise)
2013 Houston Investor & Analyst Event
PENTAIR
VALVES & CONTROLS OFFERINGS
85
Leading Global Valves & Controls Supplier … $2.4B
Actuation & Controls Quarter Turn Valves Pressure Management Valves GGC & Control Valves
SALES BY PRODUCT PLATFORM
100% = ~$2.4B*
SALES BY VERTICAL
100% = ~$2.4B*
Energy Industrial Other Developed Fast Growth U.S. & Canada Western Europe
SALES BY GEOGRAPHY
100% = ~$2.4B*
SALES BY CHANNEL
100% = ~$2.4B*
Projects Installed
2013 Houston Investor & Analyst Event
* 2013 estimated sales.PENTAIR
QUARTER TURN VALVES
~$1B Estimated Quarter Turn Valves Revenue in 2013
86
SALES BY VERTICAL
Energy Industrial
SALES BY REGION SALES BY CHANNEL MAJOR BRANDS SAMPLE CUSTOMERS KEY GROWTH DRIVERS / VERTICALS PRODUCT
Installed Projects U.S. & Canada Fast Growth Other Developed Western Europe
Butterfly Valve Ball Valve
Production, Storage, and Offloading)
Petrochemical
Isolation
2013 Houston Investor & Analyst Event
Triple Offset Valve
100% = ~$1.0B* 100% = ~$1.0B* 100% = ~$1.0B*
* 2013 estimated sales.PENTAIR
PRESSURE MANAGEMENT VALVES
87
SALES BY VERTICAL
Energy Industrial
SALES BY REGION SALES BY CHANNEL MAJOR BRANDS SAMPLE CUSTOMERS KEY GROWTH DRIVERS / VERTICALS PRODUCT
Aftermarket Project
Direct Spring Relief Valve Pilot Operated Relief Valve
~$600M Estimated Pressure Management Valves Revenue in 2013
and Refining
Farms
Boiler Protection
U.S. & Canada Fast Growth Other Developed Western Europe Installed Projects
2013 Houston Investor & Analyst Event
100% = ~$0.6B* 100% = ~$0.6B* 100% = ~$0.6B*
* 2013 estimated sales.PENTAIR
GATE, GLOBE, CHECK & CONTROL VALVES
88
SALES BY VERTICAL
Energy Industrial
SALES BY REGION SALES BY CHANNEL MAJOR BRANDS SAMPLE CUSTOMERS KEY GROWTH DRIVERS / VERTICALS PRODUCT
Installed Projects U.S. & Canada Fast Growth Other Developed Western Europe
Knife Gate Valve Globe Valve
~$400M Estimated Gate, Globe, & Check Valves Revenue in 2013
Power Plants
Mining
and Refining
2013 Houston Investor & Analyst Event
100% = ~$0.4B* 100% = ~$0.4B* 100% = ~$0.4B*
* 2013 estimated sales.PENTAIR
ACTUATION & CONTROLS
89
SALES BY VERTICAL
Energy Industrial
SALES BY REGION SALES BY CHANNEL MAJOR BRANDS SAMPLE CUSTOMERS KEY GROWTH DRIVERS / VERTICALS PRODUCT
Installed Projects U.S. Fast Growth Other Developed
Valve Actuator Valve Positioner
~$400M Estimated Actuation & Controls Revenue in 2013
Companies
Production, Storage, and Offloading)
Petrochemical
U.S. & Canada Fast Growth Other Developed Western Europe Energy Industrial
2013 Houston Investor & Analyst Event
100% = ~$0.4B* 100% = ~$0.4B* 100% = ~$0.4B*
* 2013 estimated sales.PENTAIR
20 40 60 80 100% Pentair Target Market
Non-Target Pentair Target Market
Non-Target PentairTarget Market
Non-Target
Target Market PentairTarget Market
PentairTarget Market
Non-Target
PentairNon- Target
WINNING THROUGH PRODUCT BREADTH
Pentair Valves & Controls is a Leader in all Segments
90
#2 #1 #1
2013 Houston Investor & Analyst Event (Includes valve parts (seals, etc.), solenoid valves, fittings, etc.; Excludes control, pressure reducing, plug, and manual diaphragm valves)
QT PMV GGC A&C Other Service $9B $4B $12B $2B $9B $2B
Non-Target Market Non-Target Market Non-Target Market Non-Target Market
Quarter Turn Pressure Management Gate, Globe, Check A&C Service Other
(Includes Valve Parts, Solenoid Valves, Fittings, etc.)
Source: EIF 2012, PNR EstimatesPENTAIR
WINNING THROUGH APPLICATION EXPERTISE
Leading Brands are Trusted for Critical Applications
91
Experience
Supplier of Full Bore, Split Body Type Ball Valves
Resilient Seated Butterfly Valve in 1951
Leading Cycle Life
Nuclear Submarines and Commercial Nuclear Plants in the US and Across the World
Relief Valves with a Track Record of Product Innovations and Technical Breakthroughs to Solve the Toughest Application Challenges ANDERSON GREENWOOD CROSBY KEYSTONE KTM
2013 Houston Investor & Analyst Event
PENTAIR
WINNING THROUGH APPLICATION EXPERTISE
Leading Brands are Trusted for Critical Applications
92
Seat Valve with “Zero Leakage”
Challenging Isolation Applications
Elastomer Sleeve Slurry Valve
and Most Technologically Advanced Slurry Valves on the Market
Plant Valve Applications for Both Nuclear and Conventional Fuels
Manufacturer for Over 50 Years
and Custom Designed Automation Solutions SEMPELL BIFFI CLARKSON VANESSA
2013 Houston Investor & Analyst Event
PENTAIR
WINNING WITH GLOBAL PRESENCE
We Can Make Commitments at a Global Level and Execute Consistently Locally
Service Center Mobile Service Center Major Manufacturing Location Major Sales Office
50+ Sales Offices 80 Service Centers 42 Manufacturing Plants
1900 780 1100 2800 1050 650 675 350
93
2013 Houston Investor & Analyst Event
# Employees
PENTAIR
WINNING WITH GLOBAL PRESENCE
Pentair Provides Global Scale to Serve Our Customers’ Needs
Downstream Activity
UNITED STATES
Upstream Activity Jetty Pipeline Downstream Activty
AUSTRALIA
LNG Storage Tanks
FRANCE
Chevron Wheatstone Project Scope…
94
2013 Houston Investor & Analyst Event
PVC Involvement Project Management Sales Offices Plants Service
Pentair Valves & Controls Supplied: Anderson Greenwood & Crosby Relief Valves Biffi Actuators Vanessa Triple Offset Valves Richards Ball Valves
EPC 1
LNG Tank Supplier
EPC 1 EPC 2 Jetty Consortium Pipeline Supplier
PENTAIR
WINNING WITH GLOBAL PRESENCE
95
Latin America
Test for Actuators, Pressure Relief, Butterfly, Knife Gate, and Control Valves China
Test for Actuators, Butterfly, Ball, Pressure Relief, and Knife Gate Valves India
Test for Actuators, Butterfly, and Slurry Valves Middle East
and Test for Gate, Globe, Check, and Ball Valves
Using Our Global Footprint to Better Serve Our Customers
2013 Houston Investor & Analyst Event
PENTAIR
WINNING WITH PROJECT AND AFTERMARKET
Valve Growth Driven by Infrastructure Expansion and Operation
96
Refinery (300,000 Barrels Per Day)
LNG Liquefaction Plant (8 MTPA)
Alumina Refinery (5 MTPA)
Greenfield Site
Aftermarket Opportunity
Power Plant (600MW Coal Fired)
Greenfield Site
Aftermarket Opportunity
2013 Houston Investor & Analyst Event
PENTAIR
KEY MESSAGES
97
Valves & Controls Positioned to Deliver Superior Value
High Demand, Fragmented Segment
— Breadth of Offering — Superior Application Expertise — Strong Global Presence — Project and Aftermarket Opportunities
— Organic Revenue Growth — Operation Improvements (PIMS) — Simplification and Standardization (Lean Enterprise)
2013 Houston Investor & Analyst Event
PENTAIR
2011 2012 2013F 2015T 2011 2012 2013F 2015T
PNR V&C EXPECTATIONS
Higher Quality of Revenue and Stronger Operating Performance
Top 2014 / 2015 Priorities 1. Drive Organic Revenue Growth Through New Product Developments 2. Capture Growth Through Improved Customer Service and Operations Improvements 3. Simplify Our Business
2013 Houston Investor & Analyst Event
Sales ($B) Operating Income ($M)
2.4
>4%
2.4
2.3
2.7 232
244
295 400+ ROS
10.2% 10.3% 12.5% >15%
98
PENTAIR
RENEWED PRODUCT INNOVATION
PIMS Tools Driving Standardized Approach to Product Development
99
New Product Sales Have Grown from $0 in 2010 to an Estimated $40M+ in 2013 with a Strong Funnel for 2014+ 1990's 2000's 2010's
Patent Filings
Patent Filings are Back to 1990s Levels Showing Reinvestment in Product Technology ~60 / Year ~28 / Year ~60 / Year
Discover
23 Projects ~ $50M+
Develop Deploy
25 Projects ~ $80M+ 17 Projects ~ $50M+
New Product Development Funnel
3 Year Run Rate Revenue Estimate
2013 Houston Investor & Analyst Event
PENTAIR
RENEWED PRODUCT INNOVATION
Pentair Valves are Innovative
100
Keystone GR Series Butterfly Valves are More Durable
Nearest Competitor
Vonk Choke Valves Last Longer
Competing Products
Cycle Life Leading to Lower Maintenance Costs Clarkson Knife Gate Valve Solves Customer Problem
Wear and Designed a New Valve
2013 Houston Investor & Analyst Event
PENTAIR
RENEWED PRODUCT INNOVATION
Pentair Valves are Innovative
101
Narvik CircTemp Desuperheater Perform More Effectively
2,000 Cycles Annually
Leading to Shorter Pipe Distances, Saving Installation, and Operating Costs Keystone CompoSeal Butterfly Valves are More Environmentally Friendly
Giving a Light Weight Alternative to Metal Body Valves
with Fully Recyclable Material Vanessa Triple Offset Valves Give Best Isolation
2013 Houston Investor & Analyst Event
PENTAIR
RENEWED PRODUCT INNOVATION
Pentair Valves are Innovative
102
Wellbond High Pressure Globe Valve is Easily Repaired
Line Repair vs. Competitors
Clarkson Slurry Knife Gate Valves provide more process uptime
Shut Off for Slurry Flows
Operating Up-Time Biffi OLGAS Hydraulic Actuator Provides Record Operating Time
Systems (HIPPS) to Prevent Over-Pressurization
Impact Damage to the Valve
2013 Houston Investor & Analyst Event
PENTAIR
ORGANIC GROWTH—LEAN
Lean Efforts Driving ~12% Increase in Aftermarket Sales
Aftermarket Focus
Handle Increased Volume
103
2013 Houston Investor & Analyst Event
Q1 Q2 Q3 Q4 Q1 Q2 Q3
+12% 0.1 0.2 0.3 0.4
Jan Feb Mar Apr May Jun Jul Aug Sep
Global MRO Sales
2012 2013
Pasadena Inside Sales Productivity
Quotes/Person/Hour
Lean Kaizen Event
PENTAIR
SERVICE FACTS
104
A Leading Global Valves Services Network
2013 Houston Investor & Analyst Event
PENTAIR
GROWTH THROUGH SERVICE CENTER EXPANSION
October 2013 Macae, Brazil New February 2011: Port Arthur, TX New March 2012: Coatzacoalcos, Mexico New August 2013: Tampico, Mexico Extension 2012 Baton Rouge, LA Extension 2012 Pasadena, TX
Latin America
April 2013 Buenos Aires Argentina Vizag Dec 2013 Hazira Dec 2013
Asia
Rayong, Thailand March 2011 Songkla, Thailand October 2010
Pacific
September 2011 Karratha, AUS Extension 2012 Gladstone, AUS
… and Others in Europe, US, Canada
Following Our Customers to Support Them Locally
105
2013 Houston Investor & Analyst Event
PENTAIR
GROWTH THROUGH AN EXPANDED OFFERING
106
Automation Valves Asset Management Turnaround Planning Turnaround Execution Project Commissioning Diagnostics Spare Parts Supply On Site Repair In Shop Repair
Innovative Services Offerings
Management in 2013 to Drive Standardization and Best Practices Across the Network
Innovating to Improve Customers Total Cost of Ownership
Basic Services Higher Value Services
2013 Houston Investor & Analyst Event
PENTAIR
Key Account Program Creates Organic Growth
107
Solve Difficult Application Requirements
Supply Chain Operations
and Reduce Maintenance Costs
Perform Efficiently, Reliably, and Safely V&C Customer Buying Trends
ORGANIC GROWTH—GLOBAL KEY ACCOUNTS
Value of V&C Key Account Management
Enables Breakthrough Solutions
Customer Supply Chain Strategy
Covers Wide Range of Needs
Customer Facilities
2011 2012 2013F 24% CAGR
15% of PV&C Revenue with Strong Growth
Oil & Gas Petrochem Mining Process Power
Global Key Accounts Across Multiple Industries
BP Chevron ConocoPhillips ExxonMobil Shell Total BASF Bayer Dow Sabic BHP Freeport- McMoRan Newmont RioTinto Air Products Praxair Siemens Veolia Alstom
2013 Houston Investor & Analyst Event
PENTAIR
IMPROVE CUSTOMER EXPERIENCE
PIMS Toolkit Supports Growth for V&C
108
0.31
0.08 0.30 0.22 0.31 0.05 Valve Performance Lead Time On-Time Delivery Ease of Maintenance Sales Support Technical Support Brand After-Market Service
V&C Performance vs. Competitors PIMS as Growth Tool
Source: PV&C market research
Products, Support, and Services
Customer Experience Via: Lean Factory Improvements Global Sourcing Office Based Lean
2013 Houston Investor & Analyst Event
PENTAIR
109
FAST LEAN EXECUTION
Valves & Controls Adopted LEAN Successfully within 12 Months
Expansion
Lean to Enterprise
Services and Sales Offices LEAN Begins
Legacy OpEx Lean Assessment 12 LEAN Focus Sites 42 Sites Lean Plans CCF / MMF / PFEP Events Mar 12 Jun 12 Sep 12 Jan 13 Apr 13 Jul 13 Oct 13 Jan 14 Apr 14
LEAN in Our DNA!
PNR / TYC Announcement 1st PIMS Meetings PNR / Flow Control Merger
*Lean Transformation Plan
12 Focus Sites Cover $1B Sales
2013 Houston Investor & Analyst Event
PENTAIR
IMPROVE CUSTOMER EXPERIENCE—LEAN FACTORY
Improved Lead Times—Sample Results to Date:
(Breda, Netherlands)
Weeks to 7 Weeks for OMNIs and 80s (Stafford, TX)
15+ Product Lines Have Seen Lead Time Reductions in Last 9 months
110
Example: Breda, Netherlands After: Productivity Increased by 200%, WIP Reduced by 99%, and Space by 75%
2013 Houston Investor & Analyst Event
PENTAIR
IMPROVE CUSTOMER EXPERIENCE—LEAN FACTORY
Improved Quality—Sample Results to Date:
Improved Quality Leading to Shorter Lead Times and Lower Costs
111
Example: Armentieres, France After: Building All Small Valves in “One Piece Flow” Reduced Rejects Significantly
Improved First Pass Yields and Less Rework
2013 Houston Investor & Analyst Event
PENTAIR
IMPROVE CUSTOMER EXPERIENCE—LEAN FACTORY
Increase Available Space—Results to Date:
250,000 Square Feet of Available Factory Space Utilizing Space to Expand Localization Efforts — Further Reducing Lead Times to Customers
112
Example: Qingpu, China Example: Black Mountain, NC
2013 Houston Investor & Analyst Event
PENTAIR
IMPROVE CUSTOMER EXPERIENCE—OFFICE LEAN
– Custom Engineered Products – Multiple Plants – Multiple Constituents: Suppliers, Inspection Agencies, Freight Companies, End Users, and EPC Firms – Detailed Testing and Certification Paperwork Required
– Variable Staffing to Match Project Phase – Co-Located Office Teams for Hyper Communication – Standard Work for Project Control – Daily Gemba Walks to Identify Issues and Resolve Quickly – Daily Objectives to Drive Results
Customers Praise the Dedicated Focus
113
Daily Gemba Walk for Project Team Early Results Show Improved Delivery, Improved Quality, Reduced Costs, and Happier Customers
2013 Houston Investor & Analyst Event
PENTAIR
SIMPLIFICATION—LEAN ENTERPRISE
Key Metrics 2010 2013F 2017T Plants 48 ~40 < 40 ERP 39 29 TBD % Production in Destination Region 61% 66% > 75% Product Groups 30+ 12 5
MILESTONES
Organizations and Created Global Vertical Industry Focus
Increased Speed and Efficiency of Decision Making and Execution
Under 4 Core Global Product Platforms
and System Consolidation
Aggressively Reducing Complexity
114
We are Building a Lean Business Model to:
Global Organization
2013 Houston Investor & Analyst Event
PENTAIR
KEY MESSAGES
115
Valves & Controls Positioned to Deliver Superior Value
High Demand, Fragmented Segment
— Breadth of Offering — Superior Application Expertise — Strong Global Presence — Project and Aftermarket Opportunities
— Organic Revenue Growth — Operation Improvements (PIMS) — Simplification and Standardization (Lean Enterprise)
2013 Houston Investor & Analyst Event
PENTAIR 2013 Houston Investor & Analyst Event
116
PENTAIR
VALVES 101—WHAT IS A VALVE
Valve: A Valve is a Mechanical Device Whose Function is to Control the Flow of Fluids in a Piping System – Control Applied to These Fluids can Take Multiple Forms
– Fluids can be Liquids, Gases, and Vapors, and can also be Liquids Carrying Suspended Solid Particles (Slurries)
Source: The Valve Primer, Brent T. Stojkov, Industrial Press Inc.
A “Globe” Valve, Used to Start and Stop Flow A “Pressure Relief” Valve, Used to Regulate Pressure
2013 Houston Investor & Analyst Event
117
PENTAIR
VALVES 101—QUARTER TURN VALVES
Quarter-Turn Valves: Category of Valves (Such as Ball or Butterfly) Which Require 90 Degree Turn of the Stem to Move from the Fully Open to the Fully Closed Position. Typically Used for Isolation and Throttling Applications.
Ball Valve A Quarter-Turn Valve with a Ball Shaped Closing Element held Between Two Seats. Ball Valves are Widely Used as On/Off Valves, but Some Special Designs are Available for Throttling Applications. Butterfly Valve A Quarter-Turn Valve Which has a Circular Disk as its Closing Element. The Standard Design has the Valve Stem Running Through the Disk, Giving a Symmetrical Appearance. Later Designs Off-Set the Stem, so that the Disk ‘Cams’ into the Valve Seat.
2013 Houston Investor & Analyst Event Source: The Valve Primer, Brent T. Stojkov, Industrial Press Inc.
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VALVES 101—GATE AND GLOBE VALVES
Gate Valve A Multi-Turn Valve Used for Isolation Applications Which has a Gate as its Closing Element. The Gate Moves Linearly, Perpendicular to the Direction of Flow. Gate Valves Provide Robust Sealing and are used Extensively in the Petrochemicals Industries. This Class
much Thinner Gates with a Knife-like Edge, Making them Suited to use with Floating Solids. Globe Valve A Multi-Turn Valve with a Closing Element that Moves Perpendicularly to the Valve Body Seat and Generally Seals in a Plane Parallel to the Direction of Flow. This Type
General Flow Control.
2013 Houston Investor & Analyst Event Source: The Valve Primer, Brent T. Stojkov, Industrial Press Inc.
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VALVES 101—CHECK AND CONTROL VALVES
Check Valve A Valve that is Designed to Allow the Fluid to Flow in a Given Direction but Closes to Prevent Backflow. Check Valves (also called Non-Return Valves) are Usually Self- Acting. Control Valve A Valve which Regulates the Flow or Pressure of a
Generated by Independent Devices such as Flow Meters, Temperature Gauges, etc. Control Valves are Normally Fitted with Actuators and Positioners.
2013 Houston Investor & Analyst Event Source: The Valve Primer, Brent T. Stojkov, Industrial Press Inc.
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VALVES 101—PRESSURE MANAGEMENT VALVES
Pressure Management Valves: Category of Valves used to Reduce Excess Pressure in Pressurized Systems, for Example a Steam Boiler. Pressure Management Valves Automatically Open to Relieve Overpressure which Prevents Potentially Violent Equipment Failure.
Direct Spring Relief Valves Typically use a Spring to Hold the disc
Pilot Operated Relief Valves The Difference Between PORV and Spring Loaded PRV is that Pilot Valves use System Pressure to Seal the Valve.
2013 Houston Investor & Analyst Event Source: The Valve Primer, Brent T. Stojkov, Industrial Press Inc.
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VALVES 101—ACTUATORS AND CONTROLS
Actuator Actuators are Mechanical Devices that use Hydraulic, Pneumatic, or Electric Power to Provide the Muscle (Torque or Thrust) Needed to Move a Valve to Open, Closed,
Actuators & Controls: Valves can be Operated with a Variety of Mechanisms from Simple Lever Handles and Hand-Wheels to Very Complex Valve Automation Systems.
Gears Gears are Mechanical Devices Used with Valves and / or Actuators to Provide the Muscle (Torque or Thrust) Needed to Move a Valve to Open, Closed, or Stop Positions. Controls Controls are the Brains which Command the Actuators’ Power. They are Instruments and / or Systems Necessary to Provide Local
and Diagnostics of Valves.
2013 Houston Investor & Analyst Event Source: The Valve Primer, Brent T. Stojkov, Industrial Press Inc.
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APPENDIX
GAAP to Non-GAAP Measurements & Reconciliations
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REPORTED TO ADJUSTED 2013 RECONCILIATION
Pentair Ltd. and Subsidiaries Reconciliation of the GAAP “As Reported” year ended December 31, 2013 to the “Adjusted” non-GAAP excluding the effect of 2013 adjustments (Unaudited) Actual
In millions, except per-share dataFirst Quarter Second Quarter Third Quarter Full Year Total Pentair Net sales $ 1,774.5 $ 1,963.7 $ 1,824.8 approx $ 7,400 Operating income—as reported 74.3 225.9 240.0 approx 782
% of net sales 4.2% 11.5% 13.2% approx 10.6%Adjustments: Inventory step-up and customer backlog 76.8 10.1 — approx 88 Restructuring and other 27.4 32.4 8.7 approx 70 Operating income—as adjusted 178.5 268.4 248.7 approx 940
% of net sales 10.1% 13.7% 13.6% approx 12.7%Net income attributable to Pentair Ltd.—as reported 51.7 154.1 172.8 approx 549 Gain on sale of business,net of tax (12.5) — — approx (13) Interest expense, net of tax — 1.6 — approx 2 Adjustments,net of tax 80.8 33.5 1.1 approx 115 Net income attributable to Pentair Ltd.—as adjusted 120.0 189.2 173.9 approx 653 Earnings per common share attributable to Pentair Ltd.—diluted Diluted earnings per common share—as reported $ 0.25 $ 0.75 $ 0.85 approx $2.68 - $2.70 Adjustments 0.33 0.17 0.01 approx 0.51 Diluted earnings per common share—as adjusted $ 0.58 $ 0.92 $ 0.86 approx $3.19 - $3.21
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REPORTED TO ADJUSTED 2013 RECONCILIATION
Pentair Ltd. and Subsidiaries Reconciliation of the GAAP “As Reported” year ended December 31, 2013 to the “Adjusted” non-GAAP excluding the effect of 2013 adjustments (Unaudited) Actual
In millionsFirst Quarter Second Quarter Third Quarter Full Year Water & Fluid Solutions Net sales $ 782.0 $ 949.8 $ 814.3 approx $ 3,345 Operating income—as reported 74.8 136.1 105.9 approx 411-416
% of net sales 9.6% 14.3% 13.0% approx 12.4%Adjustments: Restructuring and other 7.5 6.6 3.5 approx 18 Inventory step-up and customer backlog 0.6 0.2 — approx 1 Operating income—as adjusted 82.9 142.9 109.4 approx 430-435
% of net sales 10.6% 15.0% 13.4% approx 13.0%Valves & Controls Net sales $ 585.8 $ 619.9 $ 611.5 approx $ 2,400 Operating income (loss)—as reported (18.6) 56.9 76.6 approx 187-192
% of net sales (3.2)% 9.2% 12.5% approx 7.9%Adjustments: Restructuring and other 7.3 17.0 3.7 approx 28 Inventory step-up and customer backlog 70.6 10.0 — approx 81 Operating income—as adjusted 59.3 83.9 80.3 approx 296-301
% of net sales 10.1% 13.5% 13.1% approx 12.4%Technical Solutions Net sales $ 410.0 $ 397.4 $ 405.9 approx $ 1,655 Operating income—as reported 53.3 65.1 82.2 approx 292-297
% of net sales 13.0% 16.4% 20.3% approx 17.8%Adjustments: Restructuring and other 10.7 4.9 1.5 approx 17 Inventory step-up and customer backlog 5.7 — — approx 6 Operating income—as adjusted 69.7 70.0 83.7 approx 315-320
% of net sales 17.0% 17.6% 20.6% approx 19.2%2013 Houston Investor & Analyst Event
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REPORTED TO ADJUSTED 2012 RECONCILIATION
Pentair Ltd. andSubsidiaries Reconciliation of the GAAP "As Reported" year endedDecember 31, 2012 to the "Adjusted" non-GAAP excluding the effect of 2012 adjustments (Unaudited) First Quarter SecondQuarter ThirdQuarter Fourth Quarter Year
In millions, except per-share data
2012 2012 2012 2012 2012 Total Pentair Net sales 858.2 $ 941.5 $ 865.5 $ 1,750.9 $ 4,416.1 $ Operating income (loss) - as reported 86.5 119.3 55.2 (304.1) (43.1) % of net sales 10.1% 12.7% 6.4% (17.4%) (1.0%) Adjustments: Deal related costs and expenses 11.8 6.3 52.7 12.0 82.8 Inventory step-up and customer backlog — — — 179.6 179.6 Restructuring — 10.4 1.1 55.3 66.8 Trade name impairment — — — 60.7 60.7 Change in accounting method - pension and post-retirement (1.5) (1.5) (1.5) 146.2 141.7 Operating income - as adjusted 96.8 134.5 107.5 149.7 488.5 % of net sales 11.3% 14.3% 12.4% 8.5% 11.1% Net income (loss) attributable to Pentair Ltd. - as reported 61.8 72.8 31.4 (273.1) (107.1) Bond redemption and interest expense (0.8) — 1.8 51.9 52.9 Other adjustments net of tax 3.0 10.9 32.3 320.9 367.1 Net income fromcontinuing operations attributable to Pentair Ltd. - as adjusted 64.0 83.7 65.5 99.7 312.9 Continuing earnings per common share attributable to Pentair Ltd. - diluted Diluted earnings (loss) per common share - as reported 0.62 $ 0.72 $ 0.31 $ (1.31) $ (0.84) $ Adjustments 0.02 0.11 0.33 1.78 3.23 Diluted earnings per common share - as adjusted 0.64 $ 0.83 $ 0.64 $ 0.47 $ 2.39 $
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Note: Inventory step-up and customer backlog reflect amortization of fair market value step-up associated with inventory and in process customer contracts.REPORTED TO ADJUSTED 2012 RECONCILIATION
Pentair Ltd. andSubsidiaries Reconciliation of the GAAP "As Reported" year endedDecember 31, 2012 to the "Adjusted" non-GAAP excluding the effect of 2012 adjustments (Unaudited) First Quarter SecondQuarter ThirdQuarter Fourth Quarter Year
In millions2012 2012 2012 2012 2012 Water & FluidSolutions Net sales 587.1 $ 675.4 $ 605.5 $ 771.2 $ 2,639.2 $ Operating income (loss) - as reported 63.7 92.0 69.2 (56.9) 168.0
% of net sales 10.8% 13.6% 11.4% (7.4%) 6.4%Adjustments: Restructuring — 6.9 1.1 42.5 50.5 Inventory step-up and customer backlog — — — 23.4 23.4 Trade name impairment — — — 49.1 49.1 Operating income - as adjusted 63.7 98.9 70.3 58.1 291.0
% of net sales 10.8% 14.6% 11.6% 7.5% 11.0%Valves & Controls Net sales — $ — $ — $ 548.6 $ 548.6 $ Operating income (loss) - as reported — — — (76.8) (76.8)
% of net sales 0.0% 0.0% 0.0% (14.0%) (14.0%)Adjustments: Restructuring — — — 5.1 5.1 Inventory step-up and customer backlog — — — 113.5 113.5 Operating income - as adjusted — — — 41.8 41.8
% of net sales 0.0% 0.0% 0.0% 7.6% 7.6%Technical Solutions Net sales 272.6 $ 267.5 $ 261.5 $ 434.8 $ 1,236.4 $ Operating income - as reported 50.5 50.6 52.3 11.6 165.0
% of net sales 18.5% 18.9% 20.0% 2.7% 13.3%Adjustments: Restructuring — 3.1 — 9.7 12.8 Inventory step-up and customer backlog — — — 42.7 42.7 Trade name impairment — — — 11.6 11.6 Operating income - as adjusted 50.5 53.7 52.3 75.6 232.1
% of net sales 18.5% 20.1% 20.0% 17.4% 18.8%2013 Houston Investor & Analyst Event
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2012 PRO FORMA ADJUSTMENTS – TOTAL PENTAIR
Note: “Other” adjustments represent the elimination of certain large projects and sales to sanctioned countries (which were terminated prior to the completion of the Flow Control acquisition), changes in corporate allocation assumptions, income taxes, and share count.Pro Forma Adjustments 2012 Total Pentair
(in millions, except EPS)Historical Adjusted Results Historical Flow Control Acquisition Depreciation & Amortization Other Adjustments Adjusted Pro Forma Results First Quarter Sales 858.2 $ 995.9 $
(74.0) $ 1,780.1 $ Operating Income 96.8 $ 124.9 $ (17.1) $ (32.2) $ 172.4 $ Net Income 64.0 $ 93.7 $ (12.8) $ (28.1) $ 116.8 $ Diluted EPS 0.64 $ 0.44 $ (0.06) $ (0.48) $ 0.54 $ Second Quarter Sales 941.5 $ 980.8 $
(33.2) $ 1,889.1 $ Operating Income 134.5 $ 143.5 $ (17.2) $ (24.0) $ 236.8 $ Net Income 83.7 $ 107.6 $ (12.9) $ (14.0) $ 164.4 $ Diluted EPS 0.83 $ 0.50 $ (0.06) $ (0.50) $ 0.77 $ Third Quarter Sales 865.5 $ 1,019.8 $
(16.0) $ 1,869.3 $ Operating Income 107.5 $ 119.9 $ (17.3) $ 5.5 $ 215.6 $ Net Income 65.5 $ 89.9 $ (13.0) $ 6.3 $ 148.8 $ Diluted EPS 0.64 $ 0.42 $ (0.06) $ (0.31) $ 0.69 $ Fourth Quarter Sales 1,750.9 $
(7.1) $ 1,743.8 $ Operating Income 149.7 $
16.6 $ 166.3 $ Net Income 99.7 $
12.7 $ 112.4 $ Diluted EPS 0.47 $
0.06 $ 0.53 $ Full Year Sales 4,416.1 $ 2,996.5 $
(130.3) $ 7,282.3 $ Operating Income 488.5 $ 388.3 $ (51.6) $ (34.1) $ 791.1 $ Net Income 312.9 $ 291.3 $ (38.7) $ (23.1) $ 542.4 $ Diluted EPS 2.39 $ 1.36 $ (0.18) $ (1.03) $ 2.54 $
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2012 PRO FORMA ADJUSTMENTS – WATER & FLUID SOLUTIONS
Note: “Other” adjustments represent changes in corporate allocation assumptions2013 Houston Investor & Analyst Event
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2012 PRO FORMA ADJUSTMENTS – VALVES & CONTROLS
Note: “Other” adjustments represent the elimination of sales to sanctioned countries (which were terminated prior to the completion of the Flow Control acquisition), and changes in corporate allocation assumptions2013 Houston Investor & Analyst Event
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2012 PRO FORMA ADJUSTMENTS – TECHNICAL SOLUTIONS
Note: “Other” adjustments represent the elimination of certain large projects and changes in corporate allocation assumptions.2013 Houston Investor & Analyst Event