Pentair (PNR) 8-K Pentair Reports Strong Second Quarter Results

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 Strong Second Quarter Results

• Second quarter sales increased 14 percent to $910 million

• Reported EPS of $0.67; Adjusted EPS increased 23 percent to record $0.75

• Generated free cash flow of $179 million in the quarter

• Completed acquisition of Clean Process Technologies in the quarter

• Raised full year adjusted EPS outlook

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

MINNEAPOLIS — July 26, 2011 — Pentair, Inc. (NYSE: PNR) announced second quarter 2011 sales of $910 million, an increase of 14 percent from the same quarter last year. These results reflected broad-based growth across its two segments, Water and Technical Products, including 7 percentage points from the recent acquisition of Norit’s Clean Process Technologies (CPT) and 3 percentage points from favorable foreign currency. Earnings per diluted share from continuing operations (EPS) were $0.67 in the second quarter 2011. Adjusting to exclude acquisition related costs, second quarter 2011 EPS was $0.75, an increase of 23 percent over the same quarter last year.

“Pentair delivered another strong quarter. Successful execution of our growth initiatives, including an increasing presence in fast growth markets, continued innovation and an expanding portfolio of energy-efficient and sustainable products, led to higher sales in the quarter,” said Randall J. Hogan, Pentair chairman and chief executive officer. “The volume benefit, along with productivity gains and pricing actions, resulted in meaningful margin expansion and earnings growth.”

“We are very excited about the recently completed CPT acquisition, adding global reach, innovative membrane technologies and system capabilities in the attractive water and beverage sectors. The CPT business, now part of Pentair Filtration Solutions, is off to a great start,” added Hogan.

The company reported second quarter operating income of $109 million compared to $100 million in the prior year quarter. Adjusting to exclude acquisition related costs, operating income was $121 million, up 21 percent, and operating margins expanded in both Water and Technical Products. The benefit from higher sales volume, pricing and productivity gains more than offset the inflation impact. Second quarter 2011 results included the benefit of a lower effective tax rate, reflecting a favorable geographic mix largely resulting from the CPT acquisition and a reduction related to a state tax law change.

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Free cash flow was $179 million in the second quarter, resulting in $117 million for the first half of 2011. The company said it expects to achieve free cash flow greater than $250 million for the full year 2011.

SECOND QUARTER BUSINESS HIGHLIGHTS

Watersales grew 15 percent year-over-year to $632 million, including 10 percentage points from the CPT acquisition and a three-percentage point favorable impact from foreign currency. Year-over-year sales growth was negatively impacted by approximately 2 percentage points due to sales in 2010 related to the Gulf Intracoastal Waterway (GIWW) project. Within Water, U.S. sales were up modestly, while Western Europe and fast growth regions continued to deliver double-digit growth. Within the five Water global businesses, the second quarter sales performances were as follows:

• Residential Flow sales were up 7 percent versus the prior year quarter, led by double-digit growth in the agricultural business and solid global residential pump sales.

• Residential Filtration sales were up 12 percent, reflecting increased distribution and new products in fast growth regions, especially Latin America and China.

• Pool sales were up 7 percent driven by expanded distribution and strong demand for energy efficient pool products.

• Engineered Flow sales were down 7 percent due to lower U.S. municipal sales largely related to the prior year benefit from GIWW, while commercial and industrial pumps sales increased year-over-year. Excluding the year-over-year impact of GIWW, sales were up modestly.

• Filtration Solutions sales increased 86 percent year-over-year, reflecting a 79-percentage point or $54 million benefit from the CPT acquisition. The remaining 7 percentage points of growth reflected broad-based strength across end-markets served, including foodservice and desalination.

Water’s second quarter reported operating income totaled $85 million. Excluding the acquisition related costs included in the Water segment, second quarter operating income increased 18 percent to $90 million and operating margins increased 40 basis points to 14.2 percent. Pricing and productivity improvements, along with volume leverage, more than offset the negative impact from inflation and continued growth investments.

Technical Productsdelivered second quarter 2011 sales of $278 million, an increase of 13 percent versus the prior year quarter, including a four-percentage point favorable impact from foreign currency.

• Strong global demand drove double-digit growth across many of the end markets served, including industrial, general electronics and energy.

• Sales in the U.S. increased 7 percent year-over-year. Fast growth regions were up 29 percent, led by China, Eastern Europe and Southeast Asia.

Technical Products’ second quarter reported operating income totaled $48 million, up 27 percent compared to $38 million in the same quarter last year. Second quarter 2011 operating margins increased to 17.3 percent, an increase of 190 basis points when compared to the prior year quarter. Strong volume leverage, along with pricing and productivity gains, more than offset the negative impact from inflation and continued growth investments.

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OUTLOOK

The company expects full year 2011 reported EPS to be in the $2.27 to $2.35 range, including approximately $0.15 of acquisition related costs. Excluding these costs, the company is raising its full year 2011 adjusted EPS guidance to a range of $2.42 to $2.50, reflecting the strong second quarter performance and benefit from the CPT acquisition. This represents an increase of 21 to 25 percent compared to 2010 EPS on expected full year 2011 sales of approximately $3.5 billion, up 14 to 16 percent compared to the prior year.

Pentair introduced third quarter 2011 EPS guidance of $0.51 to $0.54, which includes an estimated $0.04 impact from acquisition related costs. As a result, the company expects an adjusted EPS of $0.55 to $0.58 in the third quarter 2011, on an estimated sales growth of 12 to 14 percent.

“Our updated guidance reflects our strong second quarter performance and the added benefit of the new CPT acquisition. With our increased presence in fast growth markets, strong innovation and continued application of lean enterprise practices, we believe we are well positioned to deliver over 20 percent adjusted earnings growth in 2011,” added Hogan.

EARNINGS CONFERENCE CALL

Pentair Chairman and CEO Randall J. Hogan and Chief Financial Officer John L. Stauch will discuss the company’s performance and second quarter 2011 results and 2011 outlook on a two-way conference call with investors and a live audio webcast at 11 a.m. Eastern today. Reconciliation of non-GAAP financial measures are set forth in the attachments to this second quarter 2011 earnings release and the second quarter 2011 earnings 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 webcast and presentation will be archived at the same site following the conclusion of the conference call.

CAUTIONCONCERNINGFORWARD-LOOKINGSTATEMENTS

Any statements made about the company’s anticipated financial results are forward-looking statements subject to risks and uncertainties such as our ability to integrate the CPT acquisition successfully; the magnitude, timing and scope of recovery from the global economic downturn; the strength of housing and related markets; foreign currency effects; material inflation outpacing our productivity and pricing actions; retail, commercial and industrial demand; increased risks associated with operating foreign businesses; product introductions; pricing and other competitive pressures; and the company’s ability to achieve its long-term strategic operating goals, 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.

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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 2010 revenues of $3.0 billion, Pentair employs over 15,000 people worldwide.

PENTAIR CONTACTS:

Sara Zawoyski

Vice President, Investor Relations

Tel.: (763) 656-5575

E-mail:sara.zawoyski@pentair.com

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Pentair, Inc. and Subsidiaries

Condensed Consolidated Statements of Income (Unaudited)

	Three months ended						Six months ended
In thousands, except per-share data	July 2, 2011			July 3, 2010			July 2, 2011			July 3, 2010
Net sales	$	910,175		$	796,167		$	1,700,448		$	1,503,180
Cost of goods sold		622,439			547,999			1,163,653			1,041,310
Gross profit		287,736			248,168			536,795			461,870
% of net sales		31.6	%		31.2	%		31.6	%		30.7	%
Selling, general and administrative		158,432			131,043			303,192			263,933
% of net sales		17.4	%		16.5	%		17.8	%		17.6	%
Research and development		19,882			16,999			38,004			34,210
% of net sales		2.2	%		2.1	%		2.3	%		2.2	%
Operating income		109,422			100,126			195,599			163,727
% of net sales		12.0	%		12.6	%		11.5	%		10.9	%
Other (income) expense:
Equity income of unconsolidated subsidiaries		(672	)		(1,375	)		(907	)		(1,459	)
Net interest expense		14,613			8,569			23,938			18,096
% of net sales		1.6	%		1.1	%		1.4	%		1.2	%
Income from continuing operations before income taxes and noncontrolling interest		95,481			92,932			172,568			147,090
Provision for income taxes		27,344			31,320			52,397			49,449
effective tax rate		28.6	%		33.7	%		30.4	%		33.6	%
Income from continuing operations		68,137			61,612			120,171			97,641
Gain on disposal of discontinued operations, net of tax		—			593			—			1,117
Net income before noncontrolling interest		68,137			62,205			120,171			98,758
Noncontrolling interest		1,425			1,124			2,918			2,356
Net income attributable to Pentair, Inc.	$	66,712		$	61,081		$	117,253		$	96,402
Net income from continuing operations attributable to Pentair, Inc.	$	66,712		$	60,488		$	117,253		$	95,285
Earnings per common share attributable to Pentair, Inc.
Basic
Continuing operations	$	0.68		$	0.61		$	1.19		$	0.96
Discontinued operations		—			0.01			—			0.01
Basic earnings per common share	$	0.68		$	0.62		$	1.19		$	0.97
Diluted
Continuing operations	$	0.67		$	0.61		$	1.17		$	0.96
Discontinued operations		—			—			—			0.01
Diluted earnings per common share	$	0.67		$	0.61		$	1.17		$	0.97
Weighted average common shares outstanding
Basic		98,333			98,208			98,190			98,081
Diluted		100,065			99,638			99,825			99,435
Cash dividends declared per common share	$	0.20		$	0.19		$	0.40		$	0.38

Pentair, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

In thousands	July 2, 2011		December 31, 2010		July 3, 2010
Assets
Current assets
Cash and cash equivalents	$	68,972	$	46,056	$	38,580
Accounts and notes receivable, net		595,407		516,905		475,679
Inventories		484,795		405,356		389,428
Deferred tax assets		60,833		56,349		49,058
Prepaid expenses and other current assets		124,632		44,631		42,878
Total current assets		1,334,639		1,069,297		995,623
Property, plant and equipment, net		410,547		329,435		318,124
Other assets
Goodwill		2,573,430		2,066,044		2,033,064
Intangibles, net		654,908		453,570		451,806
Other		78,788		55,187		54,083
Total other assets		3,307,126		2,574,801		2,538,953
Total assets	$	5,052,312	$	3,973,533	$	3,852,700
Liabilities and Shareholders’ Equity
Current liabilities
Short-term borrowings	$	21,451	$	4,933	$	2,320
Current maturities of long-term debt		1,289		18		163
Accounts payable		315,403		262,357		248,679
Employee compensation and benefits		108,836		107,995		86,471
Current pension and post-retirement benefits		8,733		8,733		8,948
Accrued product claims and warranties		47,259		42,295		42,981
Income taxes		21,498		5,964		23,252
Accrued rebates and sales incentives		42,567		33,559		34,418
Other current liabilities		144,366		80,942		78,496
Total current liabilities		711,402		546,796		525,728
Other liabilities
Long-term debt		1,384,167		702,521		734,472
Pension and other retirement compensation		217,021		209,859		213,142
Post-retirement medical and other benefits		27,954		30,325		29,819
Long-term income taxes payable		23,832		23,507		24,821
Deferred tax liabilities		235,422		169,198		139,977
Other non-current liabilities		85,660		86,295		92,926
Total liabilities		2,685,458		1,768,501		1,760,885
Shareholders’ equity		2,366,854		2,205,032		2,091,815
Total liabilities and shareholders’ equity	$	5,052,312	$	3,973,533	$	3,852,700
Days sales in accounts receivable (13 month moving average)		61		60		60
Days inventory on hand (13 month moving average)		83		82		83
Days in accounts payable (13 month moving average)		72		71		69

Pentair, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

	Six months ended
	July 2,			July 3,
In thousands	2011			2010
Operating activities
Net income before noncontrolling interest	$	120,171		$	98,758
Adjustments to reconcile net income to net cash provided by (used for) operating activities
Gain on disposal of discontinued operations		—			(1,117	)
Equity income of unconsolidated subsidiaries		(907	)		(1,459	)
Depreciation		32,685			28,876
Amortization		17,180			13,357
Deferred income taxes		3,012			2,396
Stock compensation		10,527			12,365
Excess tax benefits from stock-based compensation		(1,465	)		(1,322	)
Loss (gain) on sale of assets		229			(57	)
Changes in assets and liabilities, net of effects of business acquisitions and dispositions
Accounts and notes receivable		(1,111	)		(33,438	)
Inventories		2,425			(38,651	)
Prepaid expenses and other current assets		(2,696	)		1,877
Accounts payable		(22,878	)		46,938
Employee compensation and benefits		(22,675	)		11,275
Accrued product claims and warranties		2,901			9,196
Income taxes		12,780			18,872
Other current liabilities		25,481			1,043
Pension and post-retirement benefits		(853	)		(12,943	)
Other assets and liabilities		(22,195	)		448
Net cash provided by (used for) operating activities		152,611			156,414
Investing activities
Capital expenditures		(35,221	)		(28,937	)
Proceeds from sale of property and equipment		89			243
Acquisitions, net of cash acquired		(733,105	)		—
Other		119			(1,286	)
Net cash provided by (used for) investing activities		(768,118	)		(29,980	)
Financing activities
Net short-term borrowings		16,518			115
Proceeds from long-term debt		1,320,957			335,021
Repayment of long-term debt		(661,422	)		(403,742	)
Debt issuance costs		(8,721	)		(50	)
Excess tax benefits from stock-based compensation		1,465			1,322
Stock issued to employees, net of shares withheld		9,551			(817	)
Repurchases of common stock		(287	)		—
Dividends paid		(39,739	)		(37,700	)
Net cash provided by (used for) financing activities		638,322			(105,851	)
Effect of exchange rate changes on cash and cash equivalents		101			(15,399	)
Change in cash and cash equivalents		22,916			5,184
Cash and cash equivalents, beginning of period		46,056			33,396
Cash and cash equivalents, end of period	$	68,972		$	38,580
Free cash flow
Net cash provided by (used for) operating activities	$	152,611		$	156,414
Capital expenditures		(35,221	)		(28,937	)
Proceeds from sale of property and equipment		89			243
Free cash flow	$	117,479		$	127,720

Pentair, Inc. and Subsidiaries

Supplemental Financial Information by Reportable Business Segment (Unaudited)

	First Qtr			Second Qtr			Six Months			First Qtr			Second Qtr			Six Months
In thousands	2011			2011			2011			2010			2010			2010
Net sales to external customers
Water Group	$	515,368		$	631,994		$	1,147,362		$	478,038		$	549,318		$	1,027,356
Technical Products Group		274,905			278,181			553,086			228,975			246,849			475,824
Consolidated	$	790,273		$	910,175		$	1,700,448		$	707,013		$	796,167		$	1,503,180
Intersegment sales
Water Group	$	455		$	316		$	771		$	517		$	427		$	944
Technical Products Group		999			1,559			2,558			703			1,047			1,750
Other		(1,454	)		(1,875	)		(3,329	)		(1,220	)		(1,474	)		(2,694	)
Consolidated	$	—		$	—		$	—		$	—		$	—		$	—
Operating income (loss)
Water Group	$	56,528		$	84,521		$	141,049		$	42,138		$	75,954		$	118,092
Technical Products Group		48,087			48,261			96,348			33,098			37,990			71,088
Other		(18,438	)		(23,360	)		(41,798	)		(11,635	)		(13,818	)		(25,453	)
Consolidated	$	86,177		$	109,422		$	195,599		$	63,601		$	100,126		$	163,727
Operating income as a percent of net sales
Water Group		11.0	%		13.4	%		12.3	%		8.8	%		13.8	%		11.5	%
Technical Products Group		17.5	%		17.3	%		17.4	%		14.5	%		15.4	%		14.9	%
Consolidated		10.9	%		12.0	%		11.5	%		9.0	%		12.6	%		10.9	%

Pentair, Inc. and Subsidiaries

Reconciliation of the GAAP “As Reported” year ending December 31, 2011 to the “Adjusted” non-GAAP

excluding the effect of 2011 adjustments (Unaudited)

Total Pentair In thousands, except per-share data	First Quarter 2011			Second Quarter 2011			Third Quarter 2011			Fourth Quarter 2011		Year 2011
Net sales	$	790,273		$	910,175		$	865,000 - $885,000		$	905,000 - $925,000	approx $	3.5B
Operating income - as reported		86,177			109,422			92,000 - 97,000			102,000 - 107,000		approx 389 - 399M
% of net sales		10.9	%		12.0	%		10% - 11%			11% - 12%		approx 11	%+
Adjustments:
CPT deal related costs		1,709			6,136			—			—
Inventory step-up and customer backlog		197			5,256			approx 6,000			approx 2,000		approx 21M
Operating income - as adjusted		88,083			120,814			98,000 - 103,000			104,000 - 109,000		approx 410 -420M
% of net sales		11.1	%		13.3	%		approx 11.5	%		11% - 12%		approx 12	%
Net income from continuing operations attributable to Pentair, Inc. - as reported		50,541			66,712			51,000 - 54,000			58,000 - 63,000		approx 226 - 234M
Adjustments net of tax		1,287			8,803			approx 4,000			approx 2,000		approx 15M
Net income from continuing operations attributable to Pentair, Inc. - as adjusted		51,828			75,515			55,000 - 58,000			60,000 - 65,000		approx 242 - 250M
Continuing earnings per common share attributable to Pentair, Inc. - diluted
Diluted earnings per common share - as reported	$	0.51		$	0.67		$	0.51 - $0.54		$	0.58 - $0.63	$	2.27 - $2.35
Adjustments		0.01			0.08			0.04			0.02		0.15
Diluted earnings per common share - as adjusted	$	0.52		$	0.75		$	0.55 - $0.58		$	0.60 - $0.65	$	2.42 - $2.50

Pentair, Inc. and Subsidiaries

Reconciliation of the GAAP “As Reported” year ending December 31, 2011 to the “Adjusted” non-GAAP

excluding the effect of 2011 adjustments (Unaudited)

Water In thousands	First Quarter 2011			Second Quarter 2011			Third Quarter 2011			Fourth Quarter 2011			Year 2011
Net sales	$	515,368		$	631,944		$	595,000 - $610,000		$	640,000 - $660,000		approx $	2.40M
Operating income - as reported		56,528			84,521			60,000 - 64,000			75,000 - 81,000			276 - 286M
% of net sales		11.0	%		13.4	%		10 - 11	%		approx 12	%		approx 11.5	%+
Adjustments - inventory step-up and customer backlog		197			5,256			approx 6,000			approx 2,000			approx 14M
Operating income - as adjusted		56,725			89,777			66,000 - 70,000			77,000 -83,000			290 - 300M
% of net sales		11.0	%		14.2	%		approx 11	%+		approx 12	%+		approx 12	%+

Pentair, Inc. and Subsidiaries

Reconciliation of the results excluding CPT for the three months ending July 2, 2011

(Unaudited)

	Total Pentair										Water
In thousands	Net Sales		Net Sales Growth			Adjusted Operating Income		Adjusted Return on Sales			Net Sales		Net Sales Growth			Adjusted Operating Income		Adjusted Return on Sales
Including CPT	$	910,175		14.3	%	$	120,814		13.3	%	$	631,994		15.1	%	$	89,777		14.2	%
CPT Impact		53,606		6.7	%		2,607					53,606		9.8	%		2,607
Excluding CPT	$	856,569		7.6	%	$	118,207		13.8	%	$	578,388		5.3	%	$	87,170		15.1	%