Pentair PLC

Ladies and gentlemen, thank you for standing by and welcome to the Q4 2020 Pentair Earnings Conference call. All lines have been placed on mute to prevent any background noise. And after the speaker's remarks, there will be a question and answer session. To ask a question during the session, you'll need to press star one on your telephone keypad. If you require operator assistance, please press star zero. I'd now like to turn the call over to your speaker today, Jim Lucas. Thank you. Please go ahead.

Thanks, James, and welcome to Pentair's fourth quarter 2020 earnings conference call. We're glad you could join us. I'm Jim Lucas, Senior Vice President, Treasurer in Investor Relations. With me today is John Stauk, our President and Chief Executive Officer, and Bob Fishman, our Chief Financial Officer. On today's call, we will provide details on our fourth quarter and full year 2020 performance, as well as our first quarter and full year 2021 outlook as outlined in this morning's press release. Before we begin, let me remind you that any statements made about the company's anticipated financial results are forward-looking statements subject to future risks and uncertainties, such as the risks outlined in Pentair's most recent Form 10-Q, Form 10-K, and today's press release. Forward-looking statements included herein are made as of today, 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. Today's webcast is accompanied by a presentation which can be found in the investor relations section of Pinter's website. We will reference these slides throughout our prepared remarks. Any references to non-GAAP financial are reconciled in the appendix of the presentation. We will be sure to reserve time for questions and answers after our prepared remarks. I would like to please request that you limit your questions to one and a follow-up in order to ensure that everyone has an opportunity to ask their questions. I will now turn the call over to John.

Thank you, Jim, and good morning, everyone. Please turn to slide number four, titled Executive Summary. I would first like to say how proud I am of the entire Pentair organization and the contributions everyone made to help deliver on our commitments to all of our stakeholders in a uniquely challenging year. Our teams navigated this unprecedented environment, and I believe that our company will emerge stronger as a result. I would also like to take this opportunity to thank all of our global channel partners and suppliers for their patience and efforts in working with us and our consumers to meet our commitments despite the effects of the ongoing pandemic. We are pleased to deliver 2% sales growth and 5% adjusted EPS growth for the year. We generated over $500 million in free cash flow and returned over $275 million to our shareholders through dividends and buybacks. While navigating this uncertain environment and making sure our employees and customers were as safe as possible, we continue to invest in our top growth priorities through digital transformation, innovation, and technology. During the year, we successfully launched both the Pentair Home and Pentair Dealer apps. We also launched a brand redesign of the Pentair.com website, allowing for better cross-functional use and microsite enablement based on feedback on how people want to interface with us. We also were able to fill out our management team by hiring Bob as our new CFO, Mario as the new leader for consumer solutions, Steve as our chief supply chain officer, and appointing Jerome Pedretti as our IoT segment leader. We have been busy building out capabilities throughout the organization, including adding over 100 IoT engineers in 2020 to drive connected solutions for consumers and for our OEM customers. We introduced new products like Fresh Point and Easy Flow in our residential POU category, our connected solution salt sensor for installed water softeners, advanced our leading sustainable gas solutions offering to recover and reuse methane and CO2, as well as introduced our brew assist digital services to remotely optimize our beer membrane solutions. By the end of 2021, we expect to have over 20 new IoT products in the pipeline as we continue to move our consumer solutions platform to smart solutions. We also made great strides in advancing our ESG stewardship, most recently appointing our general counsel, Carla Robertson, to the additional role of chief social responsibility officer. We recently completed a comprehensive ESG assessment to identify key topics of importance to our shareholders, customers, suppliers, employees, and communities. We are planning to announce specific targets, including science-based environmental targets, in 2021 to further advance our social responsibility goals and progress. We have spent the past few years repositioning our portfolio and making investments to build out the Pentair brand and create a better experience for consumers to help solve their water treatment needs. While we benefited from a residential-focused portfolio in 2020, we believe that the momentum will carry into 2021 and beyond. I would now like to turn the call over to Bob to discuss our performance and our financial results in more detail, after which I'll provide an update on our overall strategic position.