Watts Water Technologies Inc

Latest Results (03.04.2026):

Watts Water Technologies Inc. reported results for the first quarter of 2025: net sales of $558.0 million (down 2% reported and organic vs. Q1 2024), GAAP operating margin of 15.7% (down 120 bps) and adjusted operating margin of 19.0% (up 80 bps), diluted EPS $2.21 (up 2%) and adjusted diluted EPS $2.37 (up 2%). The company increased its quarterly dividend 21% to $0.52 per share and is maintaining its full‑year 2025 organic sales and adjusted operating margin outlook.

Sales

Net sales were $558.0M, a 2% decline year‑over‑year (also down 2% on an organic basis). Fewer shipping days drove ~3% of the organic decline, Europe experienced destocking, acquisitions added $5M in the Americas, and unfavorable FX reduced sales by about $6M (1%).

Profitability

GAAP operating income fell to $87.7M and operating margin to 15.7% (-120 bps). Adjusted operating income was $106.1M with an adjusted margin of 19.0% (+80 bps), helped by price, productivity and cost actions that offset volume deleverage. Restructuring charges rose to $17.3M (vs. $1.2M in Q1 2024).

Earnings per Share

Diluted EPS was $2.21 (+2% vs. Q1 2024). Adjusted diluted EPS was $2.37 (+2%), after tax‑effected adjustments related to restructuring and acquisition items.

Dividend & Capital Return

The board approved a 21% increase in the quarterly dividend to $0.52 per share (effective June 2025). The company repurchased ~19,000 Class A shares for $3.9M in Q1 and has ~ $141M remaining on its repurchase authorization.

Cash Flow & Balance Sheet

Operating cash flow was $55.2M and free cash flow $45.6M (up vs. Q1 2024), driven largely by lower tax payments. Cash and cash equivalents were $336.8M and net debt was negative $139.6M (net cash position), with net debt to capitalization at -8.6%.

Regional Performance

Americas: $418M sales (flat reported, -1% organic) with a 23.4% segment margin (+130 bps). Europe: $108M (-12% reported, -9% organic) with margin 13.9% (-180 bps). APMEA: $32M (+9% reported, +13% organic) with margin 17.5% (-70 bps).

Outlook

The company is maintaining its full‑year 2025 guidance: reported sales growth -2% to +3% and organic sales -3% to +2%; operating margin 16.7%–17.3% (adjusted operating margin 17.7%–18.3%). The outlook incorporates estimated tariff impacts and planned actions as of May 7, 2025.