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 5, 2008

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 5, 2008, Pentair, Inc. issued a press release announcing its earnings for the fourth quarter and fiscal year 2007 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 and adjusted earnings per share) and includes a reconciliation of those non-GAAP financial measures to the corresponding financial measures contained in the Company’s financial statements prepared in accordance with generally accepted accounting principles. The adjusted financial measures eliminate certain expenses incurred in the third and fourth quarter of 2007 and in the third quarter of 2006, to restructure certain operations of the Company by reducing capacity, closing facilities, reducing headcount and settling certain legal matters and in 2006 writing down inventory and receivables, all with the exception of the legal settlement, were a result of the significant continuing downturn in residential end-markets in the Company’s water business. The adjusted financial measures in 2007 and 2006 also exclude the favorable impact of a one-time reduction of income taxes. Management utilizes these adjusted financial measures to assess the performance of its continuing operations against its performance in 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 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 exhibits are 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 5, 2008 announcing the earnings results for the fourth quarter and fiscal year 2007.

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 5, 2008.

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

PENTAIR, INC.

Exhibit Index to Current Report on Form 8-K
Dated February 5, 2008

Exhibit Number	Description
99.1	Pentair, Inc. press release dated February 5, 2008 announcing the earnings results for the fourth quarter and fiscal year 2007.

EX-99.1

Exhibit 99.1

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

News Release

Pentair Announces Record Earnings Per Share of $2.10 for Fiscal Year 2007 on Record Sales of $3.4 Billion, Up 8 Percent

• Delivers full year net earnings per share from continuing operations (EPS) on adjusted basis* $2.08, up 21 percent versus 2006 adjusted EPS of $1.72

• Generates record free cash flow of $285 million for the full year 2007, up $104 million versus 2006

• Reports strong fourth quarter sales of $830 million, up 12 percent year over year

• Announces fourth quarter reported EPS of 48 cents or 51 cents on an adjusted basis*

• Affirms full year 2008 EPS guidance of between $2.25 and $2.40

* Adjusted 2007 and 2006 EPS exclude the benefit of non-recurring tax items as well as the negative impact associated with restructuring costs, legal settlements, and other market related actions in the respective period. Adjusted 2007 and 2006 Operating Income and Margins exclude the negative impact associated with restructuring costs, legal settlements and other market related actions in the respective period (see reconciliation tables attached to this release).

GOLDEN VALLEY, Minn. — February 5, 2008 — Pentair, Inc. (NYSE: PNR) today announced fourth-quarter earnings per share of 48 cents, up 23 percent from 39 cents per share in the fourth quarter 2006. Fourth quarter 2007 adjusted earnings per share of 51 cents were up 65 percent as compared to fourth quarter 2006 adjusted earnings per share of 31 cents. Fourth quarter 2007 adjusted earnings per share exclude $0.01 per share favorable impact from one-time net tax benefits and $0.04 per share negative impact from restructuring and legal matters. Fourth quarter 2007 earnings per share benefited from curtailments associated with changes to the company’s long-term, defined benefit and retiree medical plans partially offset by certain cost actions. The net impact of these items provided a $0.02 EPS benefit in the fourth quarter of 2007.

Pentair’s sales for fourth quarter 2007 were $830 million, an increase of 11.7 percent from the year-ago quarter or 4 percent excluding acquisitions and foreign exchange. In the quarter, the company delivered operating income of $90 million versus $61 million in the year-earlier quarter. On a reported basis, operating margins expanded 260 basis points to 10.9 percent. The company delivered adjusted operating income of $96 million. On this basis, operating margins expanded 330 basis points to 11.6 percent. Margin expansion was driven by a positive 600 basis point improvement from productivity, price, acquisitions, and volume. These items more than offset a negative 270 basis point impact related to total inflation.

“Pentair’s fourth quarter results demonstrate the value of the diversity in our end markets,” said Randall J. Hogan, Pentair chairman and CEO. “Our investments in key growth regions and vertical market initiatives, such as food service, desalination, commercial pools and industrial water, produced double digit growth. These focused initiatives, coupled with our strong overall growth in China, India and the Middle East, provide momentum as we exit the year,” he added. “Further, the actions we took early in the decline of the North American residential market and our productivity and lean enterprise disciplines enabled the company to expand margins as expected.”

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Fourth Quarter Business Highlights

The Water Group delivered $566 million in sales or 13 percent year-over-year sales growth. Acquisitions accounted for 7 points of growth and foreign exchange equaled 2 points of growth.

• Sales in Asia-Pacific grew 28 percent year-over-year. These results reflect strong growth in China sales for filtration and pump systems, and in India led by sales of commercial pump, food service solutions and rural water systems.

• Sales in Europe grew 51 percent year-over-year or 12 percent excluding the Jung Pump acquisition. These results reflect strength in the East European markets as well as key successes in the flow technologies market in the Middle East.

• North American filtration sales rose 11 percent with strong growth in food service, commercial water treatment and industrial markets muted by declines in residential water treatment markets. Total North American filtration sales were down when adjusted to exclude the Porous Media acquisition.

• North American flow technologies (previously named North American pump) sales were flat as growth in commercial and municipal markets, new products and pricing actions offset declines in residential markets.

• North American pool and spa sales increased 11 percent as new products, price actions and a solid early buy program more than offset residential market softness.

The Water Group’s fourth quarter operating income totaled $64 million, an increase of 70 percent as compared to $38 million in the same period last year. On an adjusted basis, the Group’s operating income was $68 million or 80 percent higher than the $38 million in the year-ago period. Adjusted operating margins of 12 percent expanded 450 basis points as the benefit from productivity actions, acquisitions, curtailment, and positive price more than offset the negative impact from inflation, decreased volumes and cost actions.

Technical Products delivered fourth quarter 2007 sales of $265 million, an increase of 9 percent versus the year-earlier period. Strong sales in Asia and in the North American electrical market set the pace.

• Total electrical sales grew approximately 10 percent driven by continued market share gains year-over-year in the industrial, commercial and networking segments. New products contributed significantly to this growth, especially in the networking segment.

• Global electronic sales increased approximately 8 percent. In Asia, sales grew 44 percent, reflecting continued growth in China. In Europe, sales increased 8 percent; in North America, sales declined approximately 3 percent.

Technical Products’ fourth quarter reported operating income totaled $40 million, an increase of 15 percent as compared to $34 million in the same quarter last year. Reported operating margins were 15 percent, up 80 basis points. Adjusting for the restructuring expenses associated with a North America plant closure, operating income totaled $42 million, up 21 percent versus the $34 million in the fourth quarter 2006. Adjusted operating margins were 15.7 percent, an increase of 150 basis points versus the year-ago period. In the quarter, the benefits from volume, price, and productivity more than offset the negative impact from total inflation.

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fiscal year 2007 results

Record sales of $3.4 billion for fiscal year 2007 increased 7.7 percent from $3.15 billion a year ago. For the year, the company reported EPS of $2.10. This represents an increase of 16 percent as compared to the $1.81 of reported EPS in 2006. Full year 2007 results include the favorable impact of $0.12 per share from one-time net tax benefits and a negative $0.10 per share impact from adjustments. Full year 2006 results included the favorable impact of $0.20 per share from one-time net tax benefits and a negative $0.11 per share impact from similar adjustments. Full year adjusted 2007 EPS was $2.08, up 21 percent as compared to adjusted full year 2006 EPS of $1.72.

For the year, Pentair generated a record $285 million in free cash flow, up 57 percent compared to free cash flow of $181 million in 2006, driven by higher income and working capital reductions. The company paid a $0.60 dividend for each share of common stock and repurchased 1.2 million shares of stock in 2007. The company recently announced it increased its dividend to $0.68 for each share of common stock. Additionally, the board has approved a $50 million share repurchase authorization that the company expects to utilize in 2008.

“Pentair’s 2007 results demonstrate tremendous achievements,” said Hogan. “Despite the uncertain economic environment, we believe we are better positioned to deliver results than we were a year ago. We delivered in 2007 because of several key factors. First, we aggressively reduced general and administrative cost and streamlined our leadership. Second, we aggressively drove Pentair’s Integrated Management System (PIMS) and achieved productivity to offset high material inflation. Moreover, we increased our investments for growth, positioned ourselves in more attractive market segments, and improved customer service levels from 2006.

“Our ability to expand margins 120 basis points on an adjusted basis and deliver free cash flow well in excess of net income reflects lean disciplines taking deeper root throughout the company, and actions taken to improve our cost structure and to lower our corporate tax rate,” Hogan noted. “The $0.04 per share or $6.0 million total pre-tax charge in the fourth quarter was taken to improve our North American electronics footprint and to settle a portion of the Horizon case. The expected benefits associated with our 2007 restructuring actions — as well as continued productivity improvements driven by lean disciplines — are included in our 2008 outlook,” he said.

Outlook

The company introduces first quarter 2008 earnings per share guidance in the range of $0.46 to $0.48, an increase of 10 to 14 percent year-over-year. The company affirms full year 2008 EPS guidance range of $2.25 to $2.40, an increase of 8 to 15 percent versus 2007 adjusted EPS.

“Pentair remains focused on delivering operating margin and earnings growth in 2008,” Hogan said. “We expect the return on the investments we made this past year to drive growth and expand international sales in 2008 – and we will further increase investments against our best opportunities. We remain relentless on cost productivity and we expect greater improvements from supply management,” he noted. “These factors, coupled with our lower sustainable tax rate, enable us to remain committed to our EPS range of $2.25 to $2.40 for 2008. We continue to drive working capital performance and expect full year 2008 free cash flow to be at least 100 percent conversion of net income,” Hogan concluded.

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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 first quarter and full year 2008 guidance on a two-way conference call with investors at 12:00 p.m. Eastern today. Reconciliation of any non-GAAP financial measures are set forth in the attachments to this fourth quarter 2007 earnings release and in the fourth quarter 2007 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 continued economic growth, including: the strength of housing and related markets; the ability to integrate acquisitions successfully and the risk that expected synergies may not be fully realized or may take longer to realize than expected; the ability to successfully limit any judgment arising out of the Horizon litigation; foreign currency effects; retail 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 diversified operating company headquartered in 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 house and protect sensitive electronics and electrical components. With 2007 revenues of $3.40 billion, Pentair employs approximately 16,000 people worldwide.

Pentair Contacts:
Todd Gleason	Rachael Jarosh
Vice President, Investor Relations	Vice President, Communications
Tel.: (763) 656-5570	Tel.: (763) 656-5280
E-mail: todd.gleason@pentair.com	E-mail: rachael.jarosh@pentair.com

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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	2007			2006			2007			2006
Net sales	$	830,224		$	743,038		$	3,398,698		$	3,154,469
Cost of goods sold		572,589			534,472			2,374,048			2,248,219
Gross profit		257,635			208,566			1,024,650			906,250
% of net sales		31.0	%		28.1	%		30.1	%		28.7	%
Selling, general and administrative		152,866			133,126			587,865			537,877
% of net sales		18.4	%		17.9	%		17.3	%		17.1	%
Research and development		14,606			14,038			58,810			58,055
% of net sales		1.8	%		1.9	%		1.7	%		1.8	%
Operating income		90,163			61,402			377,975			310,318
% of net sales		10.9	%		8.3	%		11.1	%		9.8	%
Gain (loss) on sale of assets, net		(1,230	)		197			(1,230	)		364
Equity losses of unconsolidated subsidiary		(1,027	)		(1,240	)		(2,865	)		(3,332	)
Net interest expense		17,396			13,020			70,237			51,881
% of net sales		2.1	%		1.7	%		2.1	%		1.6	%
Income from continuing operations before income taxes		70,510			47,339			303,643			255,469
% of net sales		8.5	%		6.4	%		8.9	%		8.1	%
Provision for income taxes		22,196			8,717			93,154			71,702
Effective tax rate		31.5	%		18.4	%		30.7	%		28.1	%
Income from continuing operations		48,314			38,622			210,489			183,767
Gain (loss) on disposal of discontinued operations, net of tax		231			15			438			(36	)
Net income	$	48,545		$	38,637		$	210,927		$	183,731
Earnings per common share
Basic
Continuing operations	$	0.49		$	0.39		$	2.13		$	1.84
Discontinued operations		—			—			—			—
Basic earnings per common share	$	0.49		$	0.39		$	2.13		$	1.84
Diluted
Continuing operations	$	0.48		$	0.39		$	2.10		$	1.81
Discontinued operations		—			—			—			—
Diluted earnings per common share	$	0.48		$	0.39		$	2.10		$	1.81
Weighted average common shares outstanding
Basic		98,448			98,747			98,762			99,784
Diluted		99,859			100,233			100,205			101,371
Cash dividends declared per common share	$	0.15		$	0.14		$	0.60		$	0.56

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

	December 31			December 31
In thousands	2007			2006
Assets
Current assets
Cash and cash equivalents	$	70,795		$	54,820
Accounts and notes receivable, net		472,222			422,134
Inventories		407,127			398,857
Deferred tax assets		51,556			50,578
Prepaid expenses and other current assets		36,321			31,239
Total current assets		1,038,021			957,628
Property, plant and equipment, net		367,426			330,372
Other assets
Goodwill		2,021,526			1,718,771
Intangibles, net		491,403			287,011
Other		82,238			71,197
Total other assets		2,595,167			2,076,979
Total assets	$	4,000,614		$	3,364,979
Liabilities and Shareholders’ Equity
Current liabilities
Short-term borrowings	$	13,586		$	14,563
Current maturities of long-term debt		5,182			7,625
Accounts payable		231,643			206,286
Employee compensation and benefits		112,147			88,882
Current pension and post-retirement benefits		8,557			7,918
Accrued product claims and warranties		49,382			44,093
Income taxes		12,599			22,493
Accrued rebates and sales incentives		36,867			39,419
Other current liabilities		90,943			90,003
Total current liabilities		560,906			521,282
Other liabilities
Long-term debt		1,042,223			721,873
Long term income taxes payable		21,306			—
Pension and other retirement compensation		161,042			207,676
Post-retirement medical and other benefits		37,147			47,842
Deferred tax liabilities		170,033			109,781
Other non-current liabilities		97,086			86,526
Total liabilities		2,089,743			1,694,980
Shareholders’ equity		1,910,871			1,669,999
Total liabilities and shareholders’ equity	$	4,000,614		$	3,364,979
Days sales in accounts receivable (13 month moving average)		53			54
Days inventory on hand (13 month moving average)		77			76
Days in accounts payable (13 month moving average)		54			56
Debt/total capital		35.7	%		30.8	%

NOTE: The Company adopted the provisions of Financial Accounting Standards Board (FASB) Interpretation No. 48, Accounting for Uncertainty in Income Taxes — an interpretation of FASB No. 109 (“FIN 48”) on January 1, 2007. As a result of adoption of FIN 48, the Company recorded an adjustment to retained earnings of $2.9 million in the first quarter of 2007. Additionally, the Company has added the line “Long-term income taxes payable” to the Company’s Condensed Consolidated Balance Sheets to report its total long-term liability for unrecognized tax benefits.

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

	Year ended
	December 31			December 31
In thousands	2007			2006
Operating activities
Net income	$	210,927		$	183,731
Adjustments to reconcile net income to net cash provided by operating activities
Loss (gain) on disposal of discontinued operations		(438	)		36
Equity losses of unconsolidated subsidiary		2,865			3,332
Depreciation		58,948			56,899
Amortization		25,601			18,197
Deferred income taxes		(16,496	)		(11,085	)
Stock compensation		22,913			25,377
Excess tax benefits from stock-based compensation		(4,204	)		(3,043	)
Loss on sale of assets, net		(1,929	)		(364	)
Changes in assets and liabilities, net of effects of business acquisitions
Accounts and notes receivable		(16,777	)		15,873
Inventories		19,057			(39,354	)
Prepaid expenses and other current assets		2,504			(5,052	)
Accounts payable		18,134			(18,935	)
Employee compensation and benefits		4,129			(13,229	)
Accrued product claims and warranties		4,739			456
Income taxes		1,885			9,556
Other current liabilities		(2,947	)		(13,784	)
Pension and post-retirement benefits		6			19,398
Other assets and liabilities		12,963			3,554
Net cash provided by continuing operations		341,880			231,563
Net cash provided by operating activities of discontinued operations		—			48
Net cash provided by operating activities		341,880			231,611
Investing activities
Capital expenditures		(62,129	)		(51,078	)
Proceeds from sale of property and equipment		5,209			684
Acquisitions, net of cash acquired		(487,561	)		(29,286	)
Divestitures		—			(24,007	)
Proceeds from sale of investment		—			1,153
Other		(5,544	)		(7,523	)
Net cash used for investing activities		(550,025	)		(110,057	)
Financing activities
Net short-term borrowings		(1,830	)		13,831
Proceeds from long-term debt		1,269,428			608,975
Repayment of long-term debt		(954,077	)		(631,755	)
Debt issuance costs		(1,876	)		—
Excess tax benefits from stock-based compensation		4,204			3,043
Proceeds from exercise of stock options		7,388			4,066
Repurchases of common stock		(40,641	)		(59,359	)
Dividends paid		(59,910	)		(56,583	)
Net cash provided by (used for) financing activities		222,686			(117,782	)
Effect of exchange rate changes on cash		1,434			2,548
Change in cash and cash equivalents		15,975			6,320
Cash and cash equivalents, beginning of period		54,820			48,500
Cash and cash equivalents, end of period	$	70,795		$	54,820
Free cash flow
Net cash provided by operating activities	$	341,880		$	231,611
Less capital expenditures		(62,129	)		(51,078	)
Proceeds from sale of property and equipment		5,209			684
Free cash flow	$	284,960		$	181,217

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Pentair, Inc. and Subsidiaries
Supplemental Financial Information by Reportable Business Segment for 2007 (Unaudited)

	First Qtr			Second Qtr			Third Qtr			Fourth Qtr			Year
In thousands	2007			2007			2007			2007			2007
Net sales to external customers
Water	$	555,412		$	665,495		$	562,133		$	565,525		$	2,348,565
Technical Products		252,583			257,150			275,701			264,699			1,050,133
Consolidated	$	807,995		$	922,645		$	837,834		$	830,224		$	3,398,698
Intersegment sales
Water	$	214		$	46		$	207		$	196		$	663
Technical Products		896			1,689			1,526			1,192			5,303
Other		(1,110	)		(1,735	)		(1,733	)		(1,388	)		(5,966	)
Consolidated	$	—		$	—		$	—		$	—		$	—
Operating income (loss)
Water	$	61,836		$	91,014		$	54,530		$	63,987		$	271,367
Technical Products		31,631			36,140			46,237			39,578			153,586
Other		(12,357	)		(12,273	)		(8,946	)		(13,402	)		(46,978	)
Consolidated	$	81,110		$	114,881		$	91,821		$	90,163		$	377,975
Operating income as a percent of net sales
Water		11.1	%		13.7	%		9.7	%		11.3	%		11.6	%
Technical Products		12.5	%		14.1	%		16.8	%		15.0	%		14.6	%
Consolidated		10.0	%		12.5	%		11.0	%		10.9	%		11.1	%

Pentair, Inc. and Subsidiaries
Supplemental Financial Information by Reportable Business Segment for 2006 (Unaudited)

	First Qtr			Second Qtr			Third Qtr			Fourth Qtr			Year
In thousands	2006			2006			2006			2006			2006
Net sales to external customers
Water	$	517,169		$	605,516		$	531,703		$	500,837		$	2,155,225
Technical Products		254,220			256,506			246,317			242,201			999,244
Consolidated	$	771,389		$	862,022		$	778,020		$	743,038		$	3,154,469
Intersegment sales
Water	$	50		$	55		$	140		$	214		$	459
Technical Products		889			1,312			1,133			623			3,957
Other		(939	)		(1,367	)		(1,273	)		(837	)		(4,416	)
Consolidated	$	—		$	—		$	—		$	—		$	—
Operating income (loss)
Water	$	56,196		$	84,956		$	36,944		$	37,734		$	215,830
Technical Products		37,704			39,678			37,050			34,473			148,905
Other		(14,735	)		(15,894	)		(12,983	)		(10,805	)		(54,417	)
Consolidated	$	79,165		$	108,740		$	61,011		$	61,402		$	310,318
Operating income as a percent of net sales
Water		10.9	%		14.0	%		6.9	%		7.5	%		10.0	%
Technical Products		14.8	%		15.5	%		15.0	%		14.2	%		14.9	%
Consolidated		10.3	%		12.6	%		7.8	%		8.3	%		9.8	%

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Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2007 to the “Adjusted” non-GAAP
excluding the effect of 2007 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands, except per-share data	2007			2007			2007			2007			2007
Net sales	$	807,995		$	922,645		$	837,834		$	830,224		$	3,398,698
Operating income — as reported		81,110			114,881			91,821			90,163			377,975
% of net sales		10.0	%		12.5	%		11.0	%		10.9	%		11.1	%
Adjustments		—			—			9,192			5,970			15,162
Operating income — as adjusted		81,110			114,881			101,013			96,133			393,137
% of net sales		10.0	%		12.5	%		12.1	%		11.6	%		11.6	%
Income from continuing operations — as reported		42,130			62,001			58,044			48,314			210,489
Adjustments — tax affected		—			—			6,246			3,881			10,127
Non-recurring tax items		(145	)		(83	)		(11,517	)		(1,073	)		(12,818	)
Income from continuing operations — as adjusted		41,985			61,918			52,773			51,122			207,798
Continuing earnings per common share — diluted
Diluted earnings per common share — as reported	$	0.42		$	0.62		$	0.58		$	0.48		$	2.10
Adjustments		—			—			(0.05	)		0.03			(0.02	)
Diluted earnings per common share — as adjusted	$	0.42		$	0.62		$	0.53		$	0.51		$	2.08
Weighted average common shares outstanding - Diluted		100,271			100,371			100,365			99,859			100,205

Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2006 to the “Adjusted” non-GAAP
excluding the effect of 2006 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands, except per-share data	2006			2006			2006			2006			2006
Net sales	$	771,389		$	862,022		$	778,020		$	743,038		$	3,154,469
Operating income — as reported		79,165			108,740			61,011			61,402			310,318
% of net sales		10.3	%		12.6	%		7.8	%		8.3	%		9.8	%
Adjustments		—			—			16,949			—			16,949
Operating income — as adjusted		79,165			108,740			77,960			61,402			327,267
% of net sales		10.3	%		12.6	%		10.0	%		8.3	%		10.4	%
Income from continuing operations — as reported		43,071			68,633			33,441			38,622			183,767
Adjustments — tax affected		—			—			10,847			—			10,847
Non-recurring tax items		(878	)		(8,023	)		(3,080	)		(8,285	)		(20,266	)
Income from continuing operations — as adjusted		42,193			60,610			41,208			30,337			174,348
Continuing earnings per common share — diluted
Diluted earnings per common share — as reported	$	0.42		$	0.67		$	0.33		$	0.39		$	1.81
Adjustments		(0.01	)		(0.08	)		0.08			(0.08	)		(0.09	)
Diluted earnings per common share — as adjusted	$	0.41		$	0.59		$	0.41		$	0.31		$	1.72
Weighted average common shares outstanding - Diluted		102,492			102,429			101,062			100,233			101,371

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Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2007 to the “Adjusted” non-GAAP
excluding the effect of 2007 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands	2007			2007			2007			2007			2007
Water
Net sales	$	555,412		$	665,495		$	562,133		$	565,525		$	2,348,565
Operating income — as reported		61,836			91,014			54,530			63,987			271,367
% of net sales		11.1	%		13.7	%		9.7	%		11.3	%		11.6	%
Adjustments		—			—			9,843			3,897			13,740
Operating income — as adjusted		61,836			91,014			64,373			67,884			285,107
% of net sales		11.1	%		13.7	%		11.5	%		12.0	%		12.1	%
Technical Products
Net sales	$	252,583		$	257,150		$	275,701		$	264,699		$	1,050,133
Operating income — as reported		31,631			36,140			46,237			39,578			153,586
% of net sales		12.5	%		14.1	%		16.8	%		15.0	%		14.6	%
Adjustments		—			—			(652	)		2,073			1,421
Operating income — as adjusted		31,631			36,140			45,585			41,651			155,007
% of net sales		12.5	%		14.1	%		16.5	%		15.7	%		14.8	%

Pentair, Inc. and Subsidiaries
Reconciliation of the GAAP “As Reported” year ending December 31, 2006 to the “Adjusted” non-GAAP
excluding the effect of 2006 adjustments (Unaudited)

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Year
In thousands	2006			2006			2006			2006			2006
Water
Net sales	$	517,169		$	605,516		$	531,703		$	500,837		$	2,155,225
Operating income — as reported		56,196			84,956			36,944			37,734			215,830
% of net sales		10.9	%		14.0	%		6.9	%		7.5	%		10.0	%
Adjustments		—			—			14,906			—			14,906
Operating income — as adjusted		56,196			84,956			51,850			37,734			230,736
% of net sales		10.9	%		14.0	%		9.8	%		7.5	%		10.7	%
Technical Products
Net sales	$	254,220		$	256,506		$	246,317		$	242,201		$	999,244
Operating income — as reported		37,704			39,678			37,050			34,473			148,905
% of net sales		14.8	%		15.5	%		15.0	%		14.2	%		14.9	%
Adjustments		—			—			—			—			—
Operating income — as adjusted		37,704			39,678			37,050			34,473			148,905
% of net sales		14.8	%		15.5	%		15.0	%		14.2	%		14.9	%

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