Pentair, Inc.	Exhibit 99.1
5500 Wayzata Blvd., Suite 800
Golden Valley, MN 55416
763 545 1730 Tel
763 656 5204 Fax

News Release [Logo of Pentair]

For release at 5:00 A.M. CDT

Contact: Mark Cain (763) 656-5278

Pentair’s Third Quarter 2003 EPS Totals $0.77 as Sales and Profits Improve; Year-to-Date Free Cash Flow Tops $148 Million

GOLDEN VALLEY, Minn. — October 16, 2003 — Pentair (NYSE: PNR) reported earnings per share (EPS) of $0.77 for the third quarter 2003, noting that third quarter margins in the Company’s Water Technologies Group improved to the same level as in last year’s third quarter, and that the Enclosures Group recorded its seventh consecutive quarter of sequential margin improvement. Pentair’s three operating groups, all of which realized sales gains in the third quarter over year-ago levels, contributed positively to Free Cash Flow (Cash from Operations less Capital Expenditures) of $89.9 million during the third quarter, resulting in year-to-date Free Cash Flow of $148.6 million, or 135 percent of net income.

Pentair’s third quarter net sales totaled $685.0 million, up nine percent from sales of $629.3 million in the same period a year ago, while operating income totaled $67.7 million, ten percent greater than the $61.8 million reported in the third quarter of 2002. Third quarter 2003 EPS of $0.77 reflects a three percent increase over EPS of $0.75 in the same period last year. The third quarter marked Pentair’s sixth consecutive quarter of favorable quarter-over-quarter EPS comparisons.

Randall J. Hogan, Pentair chairman and CEO, said: “We’ve seen continued progress on margins and some encouraging sales trends in both our Water Technologies and Enclosures Groups. Our Tools business also realized a slight improvement in sales, but severe price competition in the marketplace continues to affect the Tools margins. Overall, our businesses are performing well in markets that appear to be stable, if not improving.”

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In the Water Technologies Group, third quarter 2003 sales of $270.9 million increased 21 percent versus the same period last year, driven by acquisitions, pool equipment, residential and commercial pumps and the European water business. Operating income of $36.2 million gained 21 percent over the same period last year, with pump margins increasing due to productivity improvements and material savings. The European water business also contributed stronger profits resulting from increased volume and the effects of currency translation. Margins in the Group were 13.4 percent, matching those of the same period last year. Pentair noted that, on a year-to-date basis, the Water Technologies Group is its largest business and it has been the largest contributor to the Company’s operating income each year since 2000.

In the Tools Group, net sales of $268.0 million in the third quarter of 2003 were up one percent compared to the same period last year. The sales gain was primarily attributed to the Oldham Saw acquisition. Lower volume in higher margin products, competitive pricing, some inflationary cost increases, and expenses related to capacity reductions continued to affect operating income, which totaled $21.4 million in the third quarter of 2003, 16 percent lower than in the same period last year. Margins of 8.0 percent were 160 basis points below those of the same period last year.

In the Enclosures Group, third quarter 2003 sales of $146.2 million were up almost five percent over the same period in 2002. The improved volume was driven by increased sales in electronics markets combined with share gains in U.S. commercial and networking markets. Third quarter operating income of $13.6 million gained 53 percent over that of the previous year’s third quarter, while margins increased 300 basis points to 9.3 percent. Higher profits in the Group were driven primarily by volume-related efficiencies and continued productivity improvements.

“We made solid gains in working capital, supply chain management, our lean enterprise initiative, and organic growth, and we’re redoubling efforts to offset competitive market price pressures in the Tools Group through additional materials savings and improved productivity,” Hogan said. “Looking forward, we expect fourth quarter 2003 EPS of between $0.62 and $0.70, compared to EPS of $0.56 in the same period last year.”

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A Pentair conference call scheduled for 11:00 a.m. CDT today will be webcast live via http://www.pentair.com. The conference call, which can be found on the site’s “Financial Information” page, will be archived at the same location.

Pentair is a Minnesota-based manufacturer whose core businesses compete in tools, water technologies, and enclosures markets. The company employs 12,000 people in more than 50 locations around the world.

Any statements made about the company’s anticipated financial results are forward-looking statements subject to risks and uncertainties such as continued economic growth; foreign currency effects; retail and industrial demand; product introductions; and pricing and other competitive pressures. 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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Pentair, Inc. and Subsidiaries

Condensed Consolidated Statements of Income (Unaudited)

	Three months ended				Nine months ended
In thousands, except per-share data	September 27 2003		September 28 2002		September 27 2003		September 28 2002
Net sales	$	685,014	$	629,301	$	2,041,519	$	1,940,480
Cost of goods sold		518,007		480,332		1,535,733		1,478,520
Gross profit		167,007		148,969		505,786		461,960
% of net sales		24.4%		23.7%		24.8%		23.8%
Selling, general and administrative		88,267		78,243		277,181		253,530
% of net sales		12.9%		12.4%		13.6%		13.1%
Research and development		10,995		8,904		32,340		26,289
% of net sales		1.6%		1.4%		1.6%		1.4%
Operating income		67,745		61,822		196,265		182,141
% of net sales		9.9%		9.8%		9.6%		9.4%
Net interest expense		9,600		8,205		29,430		32,411
% of net sales		1.4%		1.3%		1.4%		1.7%
Income before income taxes		58,145		53,617		166,835		149,730
% of net sales		8.5%		8.5%		8.2%		7.7%
Provision for income taxes		19,770		16,214		56,724		47,913
Effective tax rate		34.0%		30.2%		34.0%		32.0%
Net income	$	38,375	$	37,403	$	110,111	$	101,817
Earnings per common share
Basic	$	0.78	$	0.76	$	2.23	$	2.07
Diluted	$	0.77	$	0.75	$	2.21	$	2.04
Weighted average common shares outstanding
Basic		49,484		49,235		49,404		49,212
Diluted		50,043		49,804		49,824		49,809
Cash dividends declared per common share	$	0.21	$	0.19	$	0.61	$	0.55

Pentair, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

In thousands	September 27 2003		December 31 2002		September 28 2002
Assets
Current assets
Cash and cash equivalents	$	50,381	$	39,648	$	39,591
Accounts and notes receivable, net		420,267		403,793		415,019
Inventories		308,150		293,202		291,308
Deferred income taxes		57,416		55,234		66,527
Prepaid expenses and other current assets		21,523		17,132		20,735
Net assets of discontinued operations		2,379		1,799		1,771
Total current assets		860,116		810,808		834,951
Property, plant and equipment, net		340,131		351,316		306,102
Goodwill		1,250,621		1,218,341		1,098,141
Other assets		136,620		133,985		115,704
Total assets	$	2,587,488	$	2,514,450	$	2,354,898
Liabilities and Shareholders’ Equity
Current liabilities
Short-term borrowings	$	102	$	686	$	—
Current maturities of long-term debt		57,499		60,488		7,284
Accounts and notes payable		180,147		171,709		188,872
Employee compensation and benefits		80,952		84,965		81,530
Accrued product claims and warranties		36,704		36,855		37,632
Income taxes		30,938		12,071		30,790
Other current liabilities		124,046		109,426		124,039
Total current liabilities		510,388		476,200		470,147
Long-term debt		605,131		673,911		559,218
Pension and other retirement compensation		135,607		124,301		82,683
Post-retirement medical and other benefits		42,162		42,815		42,762
Deferred income taxes		34,110		31,728		35,390
Other noncurrent liabilities		63,786		59,771		64,423
Total liabilities		1,391,184		1,408,726		1,254,623
Shareholders’ equity		1,196,304		1,105,724		1,100,275
Total liabilities and shareholders’ equity	$	2,587,488	$	2,514,450	$	2,354,898
Days sales in accounts receivable (13 month moving average)		57		59		62
Days inventory on hand (13 month moving average)		64		63		66
Days in accounts payable (13 month moving average)		52		53		55
Debt/total capital		35.6%		39.9%		34.0%

Pentair, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

	Nine months ended
In thousands	September 27 2003			September 28 2002
Operating activities
Net income	$	110,111		$	101,817
Depreciation		47,366			44,499
Other amortization		3,905			2,592
Deferred income taxes		(272	)		4,263
Stock compensation		306			—
Changes in assets and liabilities, net of effects of business acquisitions
Accounts and notes receivable		(7,458	)		(9,236	)
Inventories		(7,640	)		11,777
Prepaid expenses and other current assets		(3,608	)		2,103
Accounts payable		3,925			8,813
Employee compensation and benefits		(5,356	)		6,230
Accrued product claims and warranties		(1,109	)		(601	)
Income taxes		17,640			24,104
Other current liabilities		10,624			4,187
Pension and post-retirement benefits		7,445			5,664
Other assets and liabilities		3,031			11,141
Net cash provided by continuing operations		178,910			217,353
Net cash (used for) provided by discontinued operations		(581	)		3,555
Net cash provided by operating activities		178,329			220,908
Investing activities
Capital expenditures		(29,720	)		(23,674	)
Proceeds from sale of businesses		—			1,744
Acquisitions, net of cash acquired		(19,409	)		—
Divestitures		(2,400	)		—
Equity investments		(5,426	)		(9,448	)
Other		48			(165	)
Net cash used for investing activities		(56,907	)		(31,543	)
Financing activities
Net short-term (repayments) borrowings		(771	)		665
Proceeds from long-term debt		486,657			194,987
Repayment of long-term debt		(558,816	)		(363,960	)
Proceeds from exercise of stock options		510			2,683
Dividends paid		(30,106	)		(27,067	)
Net cash used for financing activities		(102,526	)		(192,692	)
Effect of exchange rate changes on cash		(8,163	)		3,074
Change in cash and cash equivalents		10,733			(253	)
Cash and cash equivalents, beginning of period		39,648			39,844
Cash and cash equivalents, end of period	$	50,381		$	39,591
Free cash flow
Net cash provided by operating activities	$	178,329		$	220,908
Less capital expenditures		(29,720	)		(23,674	)
Free cash flow	$	148,609		$	197,234

Pentair, Inc. and Subsidiaries

Supplemental Financial Information by Reportable Business Segment (Unaudited)

In thousands	First Qtr 2003			Second Qtr 2003			Third Qtr 2003			Nine Months 2003			First Qtr 2002			Second Qtr 2002			Third Qtr 2002			Nine Months 2002
Net sales to external customers
Tools	$	251,765		$	283,416		$	268,028		$	803,209		$	252,092		$	303,771		$	265,732		$	821,595
Water		246,440			290,692			270,901			808,033			211,411			265,531			223,637			700,579
Enclosures		139,453			145,236			146,233			430,922			139,560			138,814			139,932			418,306
Intersegment sales elimination		(142	)		(355	)		(148	)		(645	)		—			—			—
Consolidated	$	637,516		$	718,989		$	685,014		$	2,041,519		$	603,063		$	708,116		$	629,301		$	1,940,480
Operating income (loss)
Tools	$	17,686		$	23,148		$	21,440		$	62,274		$	16,686		$	30,837		$	25,479		$	73,002
Water		29,504			46,002			36,197			111,703			29,747			43,708			29,969			103,424
Enclosures		9,865			11,703			13,555			35,123			4,608			6,995			8,884			20,487
Other		(4,867	)		(4,521	)		(3,447	)		(12,835	)		(5,314	)		(6,948	)		(2,510	)		(14,772	)
Consolidated	$	52,188		$	76,332		$	67,745		$	196,265		$	45,727		$	74,592		$	61,822		$	182,141
Operating income as a percent of net sales
Tools		7.0%			8.2%			8.0%			7.8%			6.6%			10.2%			9.6%			8.9%
Water		12.0%			15.8%			13.4%			13.8%			14.1%			16.5%			13.4%			14.8%
Enclosures		7.1%			8.1%			9.3%			8.2%			3.3%			5.0%			6.3%			4.9%
Consolidated		8.2%			10.6%			9.9%			9.6%			7.6%			10.5%			9.8%			9.4%

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