Pentair third-quarter EPS falls to $0.91 as Pool sales drop 18%

Pentair plc (PNR) said Tuesday that third-quarter 2026 sales were $976 million, down 4% from a year earlier. Diluted earnings per share from continuing operations were $0.91, against $1.12 a year earlier.

Adjusted diluted EPS was $1.18, compared with $1.24 in the third quarter of 2025, a 5% decrease.

Here's how the company did:

• Revenue: $976.4 million vs. $1,022.0 million a year earlier
• GAAP EPS: $0.91 vs. $1.12 a year earlier
• Adjusted EPS: $1.18 vs. $1.24 a year earlier
• Operating income: $195.9 million vs. $231.7 million a year earlier
• Adjusted operating income: $242.0 million vs. $262.6 million a year earlier

Operating income fell 15% from a year earlier. Return on sales, or operating income as a share of sales, was 20.1%, down 260 basis points.

Adjusted operating income was $242 million, down 8%. Adjusted return on sales was 24.8%, down 90 basis points.

Excluding currency translation, acquisitions and divestitures, core sales declined 5%. Net cash provided by operating activities was $169 million, compared with $196 million a year earlier.

Free cash flow, which the company uses to show cash available to pay dividends, repurchase shares and repay debt, was $153 million, against $179 million a year earlier.

The results include approximately $8 million of refunds under the International Emergency Economic Powers Act, known as IEEPA, during the quarter.

"We delivered solid third-quarter results across sales, income and EPS," said President and Chief Executive Officer John L. Stauch. "Our teams executed well during the quarter and responded with focus and urgency following a challenging second quarter in our Pool segment."

Segment results

Flow sales rose 4% from a year earlier, and core sales grew 1%. Flow segment income was $69 million, up 15%, with return on sales of 26.2%, up 250 basis points.

Water Solutions sales rose 1%, and core sales also grew 1%. Segment income was $121 million, up 16%, and return on sales was 28.7%, up 370 basis points.

Pool sales fell 18%, and core sales declined 18%. Segment income was $72 million, down 38%, with return on sales of 24.6%, down 820 basis points. The company said third-quarter Pool performance reflected completion of inventory realignment with its channel partners.

Effective Jan. 1, 2026, the company moved its legacy residential and irrigation flow business from the Flow segment into Water Solutions. Prior-period amounts were reclassified, and the company said the change has no impact on its historical consolidated financial performance.

Nine-month results

For the first nine months, sales were $2,945.7 million, compared with $3,155.5 million a year earlier. Diluted GAAP EPS was $2.76, against $2.94.

Full-year guidance

The company updated its estimated 2026 GAAP EPS from continuing operations to approximately $3.76. The press release does not give the previous GAAP figure.

It reaffirmed the midpoint of its previous adjusted EPS guidance and expects full-year adjusted EPS of approximately $4.70.

Full-year reported sales are now expected to be down approximately 3%. Operating income and adjusted operating income are each expected to be down approximately 6%.

"Our solid third-quarter performance increases our confidence in the full-year outlook and enables us to reaffirm the midpoint of our previous guidance range," Stauch said.

For the fourth quarter, the company expects GAAP EPS from continuing operations of approximately $1.07 and adjusted EPS of approximately $1.15. Fourth-quarter sales are expected to be up approximately 7% to 9% on a reported basis from the fourth quarter of 2025.

The full-year guidance includes the right-sizing of channel inventory ahead of the 2027 pool season and the acquisition of Taco Group Holdings, or Taco. The press release does not give the price of the Taco deal. A footnote dates the acquisition to Oct. 1, 2026, and says its purchase price allocation is incomplete, so forecast intangible amortization excludes it.

Costs and capital returns

Third-quarter restructuring and other charges were $11.4 million, transformation costs were $16.1 million, and deal-related costs were $3.4 million. Intangible amortization was $15.1 million.

Over the first nine months, the company repurchased $350 million of ordinary shares, compared with $175 million a year earlier.

Pentair paid a regular cash dividend of $0.27 per share in the third quarter. On Sept. 21, 2026, it announced a regular quarterly dividend of $0.27 per share, payable Nov. 6, 2026, to holders of record at the close of business on Oct. 23. The company said this year marks the 50th consecutive year it has increased its dividend.

Robert P. Fishman is outgoing interim executive vice president and chief financial officer, and Robert W. Hau is incoming executive vice president and chief financial officer, the release said. Stauch, Fishman and Hau were scheduled to discuss the results on a conference call at 9:00 a.m. Eastern.