WTS WATTS WATER TECHNOLOGIES INC

Overview and Growth

Fiscal 2025 results for WATTS WATER TECHNOLOGIES INC combined $2.44B of revenue with net income of $340.80M and an operating cash inflow of $402.00M. At $2.44B, the top line establishes the operating scale supporting the company’s profit and cash-flow profile. The top line expanded 8.3% from $2.25B in fiscal 2024, increasing the company’s operating scale. The company reported diluted EPS of $10.17, adding a shareholder-level measure to the absolute income figures considered below. The per-share result recorded a 17.0% increase from fiscal 2024 diluted EPS of $8.69. Asset turnover was 0.85x, relating the company’s annual revenue directly to the total assets reported at the period end.

Profitability

Gross profit was $1.21B, representing the portion of revenue remaining after the reported cost of revenue and before operating expenses. Gross margin was 49.5%, so that share of each revenue unit remained after the cost of revenue reported for the period. Operating income was $448.10M, the earnings remaining from reported operations after the company’s recognized operating cost structure. The operating result equaled 18.4% of revenue, placing the absolute operating-income figure in the context of the company’s sales base. After all reported below-operating-line items, the company recorded net income of $340.80M for the fiscal year. Net margin was 14.0%, meaning that this portion of revenue remained as net income after all recognized expenses. Pretax income was $445.80M, isolating the reported earnings outcome before the income-tax provision recognized for the fiscal year. Pretax income represented 18.3% of revenue, placing earnings before tax in the context of the company’s operating scale. Income tax expense totaled $105.00M, providing the reported tax component that separates pretax and after-tax earnings. The effective relationship between income tax and positive pretax income was 23.6%, without assuming a statutory-rate comparison. The relationship between net income and period-end equity was 16.8%, indicating the profitability achieved on book capital.

Liquidity and Capital Structure

At period end, current assets of $1.29B compared with current liabilities of $512.40M, defining the company’s short-term resource position. The current ratio was 2.51x, with current assets exceeding current liabilities and providing a short-term liquidity cushion. Cash and equivalents totaled $405.50M, identifying the most liquid reported component available within the broader current-asset balance. Cash and equivalents represented 79.1% of current liabilities, showing the portion of near-term obligations matched by reported cash alone. Borrowings totaled $197.70M, adding a fixed financing obligation alongside the company’s equity capital. Debt equaled 0.1x of book equity, describing the relative scale of borrowing and shareholder capital. Relative to total assets, debt measured 6.9%, showing how much of the asset base was matched by borrowing. Measured against total assets, cash and equivalents represented 14.1%, a balance-sheet composition measure rather than a liquidity forecast. Total assets were 20.2% higher than fiscal 2024 assets of $2.40B, measuring the company’s own balance-sheet change.

Cash Flow and Earnings Quality

Operating activities produced a cash inflow of $402.00M, giving the cash-flow counterpart to the accrual-based profit measures reported for the year. Against net income, operating cash flow measured 1.18x, showing the relationship between accrual earnings and operating cash. The cash-flow statement records $45.70M of capital expenditures, the investment amount considered after operating cash generation. Relative to operating cash flow, capital expenditures measured 11.4%, connecting investment intensity with the company’s cash-generation base. Free cash flow came to $356.30M, leaving a positive amount after capital expenditures. Relative to revenue, free cash flow equaled 14.6%, showing how much sales converted into cash after investment. Measured against total assets, free cash flow represented 12.4%, showing the cash productivity of the company’s assets.

Based on the annual report for the fiscal year ending Dec 31, 2025. Analysis generated Sep 24, 2026.