8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 2, 2010

Commission file number 000-04689

Pentair, Inc.

(Exact name of Registrant as specified in its charter)

Minnesota	41-0907434
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification number)
5500 Wayzata Blvd, Suite 800, Golden Valley, Minnesota	55416
(Address of principal executive offices)	(Zip code)

Registrant’s telephone number, including area code: (763) 545-1730

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02 Results of Operations and Financial Condition

On February 2, 2010, Pentair, Inc. (the “Company”) issued a press release announcing its earnings for the fourth quarter and fiscal year 2009 and a conference call in connection therewith. A copy of the release is furnished herewith as Exhibit 99.1 and incorporated herein by reference.

This press release refers to certain non-GAAP financial measures (adjusted operating income, adjusted operating margins, adjusted earnings per share and free cash flow) and a reconciliation of those non-GAAP financial measures to the corresponding financial measures contained in the Company’s financial statements prepared in accordance with generally accepted accounting principles.

Adjusted operating income, adjusted operating margins and adjusted earnings per share eliminate (i) certain expenses incurred to restructure certain operations of the Company by reducing capacity, closing facilities and reducing headcount, (ii) the impact of the additional reserve recorded for the Horizon litigation settlement, (iii) the gain on the transaction entered into with GE Water & Process Technologies, a unit of General Electric Company (“GE”), to combine GE’s and the Company’s respective global water softener and residential water filtration businesses, (iv) charges related to intangible asset impairment and (v) charges for early redemption of bonds. Management utilizes these adjusted financial measures to assess the run-rate of its continuing operations against those of prior periods without the distortion of these factors. The Company believes that these non-GAAP financial measures will be useful to investors as well to assess the continuing strength of the Company’s underlying operations in light of the downturn in the residential end markets.

The Company uses free cash flow and conversion of income from continuing operations to assess its cash flow performance. The Company believes free cash flow and conversion of income from continuing operations are important measures of operating performance because they provide the Company and its investors a measurement of cash generated from operations that is available to pay dividends and repay debt. In addition, free cash flow and conversion of income from continuing operations are used as criteria to measure and pay compensation-based incentives. The Company’s measure of free cash flow and conversion of income from continuing operations may not be comparable to similarly titled measures reported by other companies.

The information contained in this Current Report shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

ITEM 9.01 Financial Statements and Exhibits

(a)	Financial Statements of Businesses Acquired
	Not applicable.
(b)	Pro Forma Financial Information
	Not applicable.
(c)	Shell Company Transactions
	Not applicable
(d)	Exhibits
	The following exhibit is provided as part of the information furnished under Item 2.02 of this Current Report on Form 8-K:

Exhibit		Description
	99.1	Pentair, Inc. press release dated February 2, 2010 announcing the earnings results for the fourth quarter and fiscal year 2009.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 2, 2010.

PENTAIR, INC. Registrant
By	/s/ John L. Stauch
	John L. Stauch
	Executive Vice President and Chief Financial Officer

PENTAIR, INC.

Exhibit Index to Current Report on Form 8-K
Dated February 2, 2010

Exhibit
Number		Description
	99.1	Pentair, Inc. press release dated February 2, 2010 announcing the earnings results for the fourth quarter and fiscal year 2009.

EX-99.1

Exhibit 99.1

Pentair, Inc.
5500 Wayzata Blvd., Suite 800
MInneapolis, MN 55416
763 545 1730 Tel
763 656 5400 Fax

News Release

Pentair Reports Full Year 2009 Net Income Per Share from Continuing Operations of $1.17; Adjusted EPS of $1.47

Company Updates 2010 Full Year Guidance Range to $1.75 to $1.90, an Increase of 19 to 29 Percent Compared to 2009 Adjusted EPS

• Reports fourth quarter sales of $702 million, down 9 percent year-over-year

• Announces fourth quarter net income per share from continuing operations (EPS) of 29 cents or 47 cents on an adjusted basis

• Updates first quarter and full year 2010 EPS guidance

All financial information and period-to-period references are on a continuing operations basis unless otherwise noted. Reconciliations to discontinued operations as well as GAAP and Non-GAAP reconciliations are in the attached financial tables.

MINNEAPOLIS, Minn. — February 2, 2010 — Pentair, Inc. (NYSE: PNR) today announced fourth quarter 2009 net earnings per diluted share from continuing operations (EPS) of $0.29. This represents an increase of 32 percent as compared to the $0.22 of EPS in the fourth quarter last year. Current period results included a negative $0.18 per share impact from restructuring and impairment charges. Adjusting for these items, fourth quarter 2009 EPS was $0.47, compared to adjusted fourth quarter 2009 EPS of $0.41, an increase of 15 percent.

Total company sales decreased 9 percent to $702 million, compared with $768 million in the fourth quarter of 2008. The company delivered fourth quarter operating income of $52 million. On an adjusted basis, the company delivered operating income of $77 million versus $74 million in the year-ago quarter. The company’s adjusted operating income in the current quarter excluded the impact of impairment charges and additional restructuring activities. Overall, adjusted operating margins for the fourth quarter increased 140 basis points to 11 percent. The positive impact on operating margins from productivity and material savings more than offset the negative impact related to lower volumes.

Total company free cash flow was positive $5 million for the quarter, or $30 million excluding a $25 million discretionary pension contribution, which the company paid in December.

“We exited 2009 with a keen sense of achievement as both our fourth quarter operating margins and EPS grew year over year despite a sales decline,” said Randall J. Hogan, Pentair chairman and chief executive officer. “We continue to benefit from tremendous productivity actions and, despite continued year-over-year sales declines, we saw volumes improve sequentially in the fourth quarter in many of our key markets,” he added.

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fourth Quarter Business Highlights

The Water Group delivered $475 million in sales, a 7 percent decline year-over-year. Sales were down 9 percent excluding foreign exchange.

• Flow Technologies sales were down 3 percent versus the year-ago quarter, as growth in the company’s global municipal market partially offset declines in commercial, industrial and residential markets.

• Filtration sales were down 9 percent as growth in the company’s food service and residential markets did not overcome commercial and industrial market declines.

• Global Pool sales were down 13 percent as the prolonged decline in North American residential pool markets persists.

The Water Group’s fourth quarter reported operating income totaled $34 million, up 5 percent as compared to $32 million in the same period last year. In the quarter, the Water Group had $21 million in pre-tax restructuring charges and intangible and asset impairments. Excluding these items, fourth quarter 2009 adjusted operating income was $55 million, up 7 percent versus fourth quarter 2008 adjusted operating income of $52 million, an increase of 140 basis points to 11.6 percent. The benefits from productivity and material savings more than offset the negative impact from volume declines and inflation.

Technical Products delivered fourth quarter 2009 sales of $227 million, a decrease of 12 percent versus the year-earlier period. Sales were down 15 percent excluding the impact of foreign exchange.

• Global Electrical sales were down 16 percent, as industrial customers continue to reduce capital projects and distributors are maintaining reduced inventory levels.

• Global Electronic sales were down 7 percent, as growth in Asia markets could not overcome declines in North American and European markets.

Technical Products’ fourth quarter reported operating income totaled $32 million, up 20 percent compared to $27 million in the same quarter last year. Adjusting for a restructuring charge, operating income was $35 million. Adjusted operating margins were 15.3 percent, up 220 basis points versus the fourth quarter 2008. The positive impact of productivity and material savings more than offset the negative impact from volume declines.

“Overall, our fourth quarter results exceeded the expectations we provided in October. While still down year-over-year, sales in the quarter were stronger than originally expected for both Water and Technical Products. That, coupled with our continued solid execution with respect to cost reductions, provides positive momentum as we enter 2010,” said Hogan.

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fiscal year 2009 results

Total company sales of $2.69 billion for fiscal year 2009 decreased 20 percent from $3.35 billion in 2008. For the year, the company reported EPS of $1.17, representing a decrease of 55 percent as compared to the $2.59 of reported EPS in 2008. Full year 2009 results included a negative 27 cents per share impact from restructuring actions and impairment charges and a negative 3 cents per share charge from the early redemption of bonds. Full year 2008 results included a favorable impact of the 86 cents per share gain from the formation of Pentair Residential Filtration, a negative 33 cents per share impact primarily from restructuring actions and impairment charges and a negative 14 cents per share impact from the settlement of the Horizon litigation. Excluding these items in both years, full year 2009 adjusted EPS were $1.47, down 33 percent when compared to full year 2008 adjusted EPS of $2.20.

For the year, Pentair generated $207 million in free cash flow, or $232 million excluding the discretionary pension contribution. Full year 2009 free cash flow represents a conversion of net income of over 160 percent. In 2008, the company generated $164 million in free cash flow.

“Pentair combated the global recession and delivered dependable results in 2009 by significantly reducing our structural costs while maintaining investments in innovation and global growth,” said Hogan. “We generated outstanding free cash flow and recently increased our dividend for the 34^th consecutive year. With our Global Business Unit (GBU) structure, leaner manufacturing footprint, new product introductions and improved global distribution capabilities, we will continue to serve our customers in 2010 and expect to improve our performance well into the future.”

Outlook

The company is updating its first quarter 2010 earnings per share guidance to a range of $0.32 to $0.35, an increase of over 60 percent year-over-year over adjusted first quarter 2009 earnings. The company is also updating its full year 2010 EPS guidance range to $1.75 to $1.90, an increase of 19 to 29 percent versus 2009 adjusted EPS. The company expects full year 2010 free cash flow to equal or exceed net income.

“Over the past three years, our water business has dealt with steady declines in its largest market — residential. The past 18 months created new challenges for all our businesses, as the global recession negatively affected each. However, through it all, we maintained growth investments, increased our dividend, lowered our debt levels and dramatically improved our manufacturing and administrative cost structure,” said Hogan. “Thanks to the hard work and resiliency of our 13,000-plus employees, Pentair is in position to benefit from improving markets and withstand new challenges and uncertainties as they arise.”

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Earnings Conference Call

Pentair Chairman and CEO Randall J. Hogan and Chief Financial Officer John L. Stauch will discuss the company’s performance and fourth quarter and full year 2009 results and 2010 outlook on a two-way conference call with investors and a live audio webcast at 9 a.m. Eastern today. Reconciliation of non-GAAP financial measures are set forth in the attachments to this fourth quarter 2009 earnings release and in the fourth quarter and full year 2009 earning release conference call presentation, both of which can be found at Pentair’s web site (www.pentair.com). Related financial charts and certain other information to be discussed on the conference call will be available on the company’s website shortly before the conference call. The web cast and presentation will be archived at the same site following the conclusion of the conference call.

Caution concerning forward-looking statements

Any statements made about the company’s anticipated financial results are forward-looking statements subject to risks and uncertainties such as the breadth and severity of the global economic downturn; the strength of housing and related markets; the ability to implement our restructuring and other cost reduction plans successfully and the risk that expected benefits may not be fully realized or may take longer to realize than expected; foreign currency effects; retail, commercial and industrial demand; product introductions; and pricing and other competitive pressures, as well as other risk factors set forth in our SEC filings. Forward-looking statements included herein are made as of the date hereof, and the company undertakes no obligation to update publicly such statements to reflect subsequent events or circumstances. Actual results could differ materially from anticipated results.

About Pentair, Inc.

Pentair (www.pentair.com) is a global diversified industrial company headquartered in Minneapolis, Minnesota. Its Water Group is a global leader in providing innovative products and systems used worldwide in the movement, treatment, storage and enjoyment of water. Pentair’s Technical Products Group is a leader in the global enclosures and thermal management markets, designing and manufacturing thermal management products and standard, modified, and custom enclosures that protect sensitive electronics and the people that use them. With 2009 revenues of $2.7 billion, Pentair employs approximately 13,150 people worldwide.

Pentair Contacts:
Todd Gleason
Vice President, Strategic Planning & Investor Relations
Tel.: (763) 656-5570
E-mail: todd.gleason@pentair.com

Pentair, Inc. and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)

	Three months ended						Year ended
	December 31			December 31			December 31			December 31
In thousands, except per-share data	2009			2008			2009			2008
Net sales	$	702,251		$	767,637		$	2,692,468		$	3,351,976
Cost of goods sold		489,794			538,144			1,907,333			2,337,426
Gross profit		212,457			229,493			785,135			1,014,550
% of net sales		30.3	%		29.9	%		29.2	%		30.3	%
Selling, general and administrative		145,346			169,149			507,303			606,980
% of net sales		20.7	%		22.0	%		18.8	%		18.1	%
Research and development		14,619			15,147			57,884			62,450
% of net sales		2.1	%		2.0	%		2.2	%		1.9	%
Legal settlement		—			—			—			20,435
Operating income		52,492			45,197			219,948			324,685
% of net sales		7.5	%		5.9	%		8.2	%		9.7	%
Other (income) expense:
Gain on sale of interest in subsidiaries		—			—			—			(109,648	)
Equity losses of unconsolidated subsidiary		688			608			1,379			3,041
Loss on early extinguishment of debt		—			—			4,804			4,611
Net interest expense		9,790			13,744			41,118			59,435
% of net sales		1.4	%		1.8	%		1.5	%		1.8	%
Other		—			106			—			106
Income from continuing operations before income taxes and noncontrolling interest		42,014			30,739			172,647			367,140
% of net sales		6.0	%		4.0	%		6.4	%		11.0	%
Provision for income taxes		14,620			9,245			56,428			108,344
Effective tax rate		34.8	%		30.1	%		32.7	%		29.5	%
Income from continuing operations		27,394			21,494			116,219			258,796
Loss from discontinued operations, net of tax		—			(2,131	)		—			(5,783	)
Gain (Loss) on disposal of discontinued operations, net of tax		134			(14,441	)		(19	)		(21,846	)
Net income before noncontrolling interest		27,528			4,922			116,200			231,167
Noncontrolling interest		(1,824	)		333			707			2,433
Net income attributable to Pentair, Inc.	$	29,352		$	4,589		$	115,493		$	228,734
Net income from continuing operations attributable to Pentair, Inc.	$	29,218		$	21,161		$	115,512		$	256,363
Earnings (loss) per common share attributable to Pentair, Inc.
Basic
Continuing operations	$	0.30		$	0.22		$	1.19		$	2.62
Discontinued operations		—			(0.17	)		—			(0.28	)
Basic earnings per common share	$	0.30		$	0.05		$	1.19		$	2.34
Diluted
Continuing operations	$	0.29		$	0.22		$	1.17		$	2.59
Discontinued operations		—			(0.17	)		—			(0.28	)
Diluted earnings per common share	$	0.29		$	0.05		$	1.17		$	2.31
Weighted average common shares outstanding
Basic		97,667			97,422			97,415			97,887
Diluted		99,226			98,299			98,522			99,068
Cash dividends declared per common share	$	0.18		$	0.17		$	0.72		$	0.68

Pentair, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)

	December 31		December 31
In thousands	2009		2008
Assets
Current assets
Cash and cash equivalents	$	33,396	$	39,344
Accounts and notes receivable, net		455,090		461,081
Inventories		360,627		417,287
Deferred tax assets		49,609		51,354
Prepaid expenses and other current assets		47,576		63,113
Total current assets		946,298		1,032,179
Property, plant and equipment, net		333,688		343,881
Other assets
Goodwill		2,088,797		2,101,851
Intangibles, net		486,407		515,508
Other		56,144		59,794
Total other assets		2,631,348		2,677,153
Total assets	$	3,911,334	$	4,053,213
Liabilities and Shareholders’ Equity
Current liabilities
Short-term borrowings	$	2,205	$	—
Current maturities of long-term debt		81		624
Accounts payable		207,661		217,898
Employee compensation and benefits		74,254		90,210
Current pension and post-retirement benefits		8,948		8,890
Accrued product claims and warranties		34,288		41,559
Income taxes		5,659		5,451
Accrued rebates and sales incentives		27,554		28,897
Other current liabilities		85,629		104,975
Total current liabilities		446,279		498,504
Other liabilities
Long-term debt		803,351		953,468
Pension and other retirement compensation		234,948		270,139
Post-retirement medical and other benefits		31,790		34,723
Long-term income taxes payable		26,936		28,139
Deferred tax liabilities		146,630		146,559
Other non-current liabilities		95,060		101,612
Total liabilities		1,784,994		2,033,144
Shareholders’ equity		2,126,340		2,020,069
Total liabilities and shareholders’ equity	$	3,911,334	$	4,053,213
Days sales in accounts receivable (13 month moving average)		62		57
Days inventory on hand (13 month moving average)		90		79
Days in accounts payable (13 month moving average)		66		59

Pentair, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)

	Year ended
	December 31			December 31
In thousands	2009			2008
Operating activities
Net income before noncontrolling interest	$	116,200		$	231,167
Adjustments to reconcile net income to net cash provided by (used for) operating activities
Loss from discontinued operations		—			5,783
Loss on disposal of discontinued operations		19			21,846
Equity losses of unconsolidated subsidiary		1,379			3,041
Depreciation		64,823			59,673
Amortization		40,657			27,608
Deferred income taxes		30,616			40,754
Stock compensation		17,324			20,572
Excess tax benefits from stock-based compensation		(1,746	)		(1,617	)
Loss on sale of assets		985			510
Gain on sale of interest in subsidiaries		—			(109,648	)
Changes in assets and liabilities, net of effects of business acquisitions and dispositions
Accounts and notes receivable		11,307			(18,247	)
Inventories		66,684			(33,311	)
Prepaid expenses and other current assets		16,202			(27,394	)
Accounts payable		(13,822	)		(1,973	)
Employee compensation and benefits		(22,431	)		(21,919	)
Accrued product claims and warranties		(7,440	)		(7,286	)
Income taxes		1,972			(4,409	)
Other current liabilities		(21,081	)		8,987
Pension and post-retirement benefits		(39,607	)		301
Other assets and liabilities		(2,141	)		18,174
Net cash provided by (used for) continuing operations		259,900			212,612
Net cash provided by (used for) operating activities of discontinued operations		(1,531	)		(8,397	)
Net cash provided by (used for) operating activities		258,369			204,215
Investing activities
Capital expenditures		(54,137	)		(53,089	)
Proceeds from sale of property and equipment		1,208			4,741
Acquisitions, net of cash acquired or received		—			(2,027	)
Divestitures		1,567			37,907
Other		(3,224	)		(12	)
Net cash provided by (used for) investing activities		(54,586	)		(12,480	)
Financing activities
Net short-term borrowings (repayments)		1,051			(16,994	)
Proceeds from long-term debt		580,000			715,000
Repayment of long-term debt		(729,150	)		(805,016	)
Debt issuance costs		(50	)		(114	)
Excess tax benefits from stock-based compensation		1,746			1,617
Proceeds from exercise of stock options		8,247			5,590
Repurchases of common stock		—			(50,000	)
Dividends paid		(70,927	)		(67,284	)
Net cash provided by (used for) financing activities		(209,083	)		(217,201	)
Effect of exchange rate changes on cash and cash equivalents		(648	)		(5,985	)
Change in cash and cash equivalents		(5,948	)		(31,451	)
Cash and cash equivalents, beginning of period		39,344			70,795
Cash and cash equivalents, end of period	$	33,396		$	39,344
Free cash flow
Net cash provided by (used for) continuing operations	$	259,900		$	212,612
Capital expenditures		(54,137	)		(53,089	)
Proceeds from sale of property and equipment		1,208			4,741
Free cash flow	$	206,971		$	164,264

Pentair, Inc. and Subsidiaries
Supplemental Financial Information by Reportable Business Segment (Unaudited)

	First Qtr			Second Qtr			Third Qtr			Fourth Qtr			Year
In thousands	2009			2009			2009			2009			2009
Net sales to external customers
Water	$	423,932		$	486,990		$	461,570		$	475,272		$	1,847,764
Technical Products		209,908			206,722			201,095			226,979			844,704
Consolidated	$	633,840		$	693,712		$	662,665		$	702,251		$	2,692,468
Intersegment sales
Water	$	289		$	198		$	284		$	510		$	1,281
Technical Products		233			600			544			834			2,211
Other		(522	)		(798	)		(828	)		(1,344	)		(3,492	)
Consolidated	$	—		$	—		$	—		$	—		$	—
Operating income (loss)
Water	$	26,976		$	49,781		$	53,085		$	33,903		$	163,745
Technical Products		20,462			23,578			24,356			31,959			100,355
Other		(10,224	)		(9,799	)		(10,759	)		(13,370	)		(44,152	)
Consolidated	$	37,214		$	63,560		$	66,682		$	52,492		$	219,948
Operating income as a percent of net sales
Water		6.4	%		10.2	%		11.5	%		7.1	%		8.9	%
Technical Products		9.7	%		11.4	%		12.1	%		14.1	%		11.9	%
Consolidated		5.9	%		9.2	%		10.1	%		7.5	%		8.2	%

	First Qtr			Second Qtr			Third Qtr			Fourth Qtr			Year
In thousands	2008			2008			2008			2008			2008
Net sales to external customers
Water	$	544,686		$	594,118		$	557,976		$	509,362		$	2,206,142
Technical Products		285,460			304,260			297,839			258,275			1,145,834
Consolidated	$	830,146		$	898,378		$	855,815		$	767,637		$	3,351,976
Intersegment sales
Water	$	372		$	139		$	305		$	228		$	1,044
Technical Products		1,138			1,034			765			1,081			4,018
Other		(1,510	)		(1,173	)		(1,070	)		(1,309	)		(5,062	)
Consolidated	$	—		$	—		$	—		$	—		$	—
Operating income (loss)
Water	$	65,035		$	59,475		$	49,684		$	32,163		$	206,357
Technical Products		45,337			49,732			47,585			26,661			169,315
Other		(13,045	)		(12,660	)		(11,655	)		(13,627	)		(50,987	)
Consolidated	$	97,327		$	96,547		$	85,614		$	45,197		$	324,685
Operating income as a percent of net sales
Water		11.9	%		10.0	%		8.9	%		6.3	%		9.4	%
Technical Products		15.9	%		16.3	%		16.0	%		10.3	%		14.8	%
Consolidated		11.7	%		10.7	%		10.0	%		5.9	%		9.7	%

Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2009 to the “Adjusted” non-GAAP
excluding the effect of 2009 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands, except per-share data	2009			2009			2009			2009			2009
Net sales	$	633,840		$	693,712		$	662,665		$	702,251		$	2,692,468
Operating income — as reported		37,214			63,560			66,682			52,492			219,948
% of net sales		5.9	%		9.2	%		10.1	%		7.5	%		8.2	%
Adjustments:
Restructuring and asset impairment		2,824			2,944			7,295			24,881			37,944
Operating income — as adjusted		40,038			66,504			73,977			77,373			257,892
% of net sales		6.3	%		9.6	%		11.2	%		11.0	%		9.6	%
Net income from continuing operations attributable to Pentair, Inc. — as reported		17,255			32,006			37,033			29,218			115,512
Adjustments — tax affected
Restructuring and asset impairment, net of minority interest		1,864			1,943			4,815			17,549			26,171
Bond tender		—			3,171			—			—			3,171
Net income from continuing operations attributable to Pentair, Inc. — as adjusted		19,119			37,120			41,848			46,767			144,854
Continuing earnings per common share attributable to Pentair, Inc. — diluted
Diluted earnings per common share — as reported	$	0.18		$	0.33		$	0.38		$	0.29		$	1.17
Adjustments		0.02			0.05			0.04			0.18			0.30
Diluted earnings per common share — as adjusted	$	0.20		$	0.38		$	0.42		$	0.47		$	1.47
Weighted average common shares outstanding — Diluted		97,966			98,422			98,641			99,226			98,522

Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2008 to the “Adjusted” non-GAAP
excluding the effect of 2008 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands, except per-share data	2008			2008			2008			2008			2008
Net sales	$	830,146		$	898,378		$	855,815		$	767,637		$	3,351,976
Operating income — as reported		97,327			96,547			85,614			45,197			324,685
% of net sales		11.7	%		10.7	%		10.0	%		5.9	%		9.7	%
Adjustments:
Restructuring and asset impairment		—			2,586			15,207			28,377			46,170
Horizon settlement		—			20,435			—			—			20,435
Operating income — as adjusted		97,327			119,568			100,821			73,574			391,290
% of net sales		11.7	%		13.3	%		11.8	%		9.6	%		11.7	%
Net income from continuing operations attributable to Pentair, Inc. — as reported		52,463			139,837			42,902			21,161			256,363
Adjustments — tax affected
Restructuring and asset impairment		—			1,707			10,037			18,729			30,473
Horizon settlement		—			13,487			—			—			13,487
Gain on PRF transaction		—			(85,832	)		—			—			(85,832	)
Bond tender		—			—			3,043			—			3,043
Net income from continuing operations attributable to Pentair, Inc. — as adjusted		52,463			69,199			55,982			39,890			217,534
Continuing earnings per common share attributable to Pentair, Inc. — diluted
Diluted earnings per common share — as reported	$	0.53		$	1.41		$	0.43		$	0.22		$	2.59
Adjustments		—			(0.71	)		0.13			0.19			(0.39	)
Diluted earnings per common share — as adjusted	$	0.53		$	0.70		$	0.56		$	0.41		$	2.20
Weighted average common shares outstanding — Diluted		99,558			99,509			99,319			98,299			99,068

Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2009 to the “Adjusted” non-GAAP
excluding the effect of 2009 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands	2009			2009			2009			2009			2009
Water
Net sales	$	423,932		$	486,990		$	461,570		$	475,272		$	1,847,764
Operating income — as reported		26,976			49,781			53,085			33,903			163,745
% of net sales		6.4	%		10.2	%		11.5	%		7.1	%		8.9	%
Adjustments — restructuring and asset impairment		1,464			1,460			2,639			21,336			26,899
Operating income — as adjusted		28,440			51,241			55,724			55,239			190,644
% of net sales		6.7	%		10.5	%		12.1	%		11.6	%		10.3	%
Technical Products
Net sales	$	209,908		$	206,722		$	201,095		$	226,979		$	844,704
Operating income — as reported		20,462			23,578			24,356			31,959			100,355
% of net sales		9.7	%		11.4	%		12.1	%		14.1	%		11.9	%
Adjustments — restructuring and asset impairment		792			1,139			4,557			2,729			9,217
Operating income — as adjusted		21,254			24,717			28,913			34,688			109,572
% of net sales		10.1	%		12.0	%		14.4	%		15.3	%		13.0	%

Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2008 to the “Adjusted” non-GAAP
excluding the effect of 2008 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands	2008			2008			2008			2008			2008
Water
Net sales	$	544,686		$	594,118		$	557,976		$	509,362		$	2,206,142
Operating income — as reported		65,035			59,475			49,684			32,163			206,357
% of net sales		11.9	%		10.0	%		8.9	%		6.3	%		9.4	%
Adjustments
Restructuring and asset impairment		—			2,157			13,438			19,628			35,223
Horizon settlement		—			20,435			—			—			20,435
Operating income — as adjusted		65,035			82,067			63,122			51,791			262,015
% of net sales		11.9	%		13.8	%		11.3	%		10.2	%		11.9	%
Technical Products
Net sales	$	285,460		$	304,260		$	297,839		$	258,275		$	1,145,834
Operating income — as reported		45,337			49,732			47,585			26,661			169,315
% of net sales		15.9	%		16.3	%		16.0	%		10.3	%		14.8	%
Adjustments — restructuring and asset impairment		—			429			633			7,209			8,271
Operating income — as adjusted		45,337			50,161			48,218			33,870			177,586
% of net sales		15.9	%		16.4	%		16.2	%		13.1	%		15.5	%