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Financial Statements of Parent Company Guarantor | 3 Months Ended
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Mar. 31, 2016
Financial Statements of Parent Company Guarantor | Pentair plc (the "Parent Company Guarantor") and Pentair Investments Switzerland GmbH (the "Subsidiary Guarantor"), fully and unconditionally, guarantee the Notes of Pentair Finance S.A. (the "Subsidiary Issuer"). The Subsidiary Guarantor is a Switzerland limited liability company and 100 percent-owned subsidiary of the Parent Company Guarantor. The Subsidiary Issuer is a Luxembourg public limited liability company and 100 percent-owned subsidiary of the Subsidiary Guarantor. The guarantees provided by the Parent Company Guarantor and Subsidiary Guarantor are joint and several. The following supplemental financial information sets forth the Company’s Condensed Consolidating Statement of Operations and Comprehensive Income (Loss), Condensed Consolidating Balance Sheets and Condensed Consolidating Statement of Cash Flows by relevant group within the Company: Pentair plc and Pentair Investments Switzerland GmbH as the guarantors, Pentair Finance S.A. as issuer of the debt and all other non-guarantor subsidiaries. Condensed consolidating financial information for Pentair plc, Pentair Investments Switzerland GmbH and Pentair Finance S.A. on a stand-alone basis is presented using the equity method of accounting for subsidiaries. Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) Three months ended March 31, 2016
In millions | Parent Company Guarantor | Subsidiary Guarantor | Subsidiary Issuer | Non-guarantor Subsidiaries | Eliminations | Consolidated Total
Net sales | $ | — |  | $ | — |  | $ | — |  | $ | 1,575.5 |  | $ | — |  | $ | 1,575.5 |
Cost of goods sold | — |  | — |  | — |  | 1,040.1 |  | — |  | 1,040.1 |
Gross profit | — |  | — |  | — |  | 535.4 |  | — |  | 535.4 |
Selling, general and administrative | 8.4 |  | — |  | 0.9 |  | 322.3 |  | — |  | 331.6 |
Research and development | — |  | — |  | — |  | 33.2 |  | — |  | 33.2 |
Operating income (loss) | (8.4 | ) | — |  | (0.9 | ) | 179.9 |  | — |  | 170.6 |
Loss (earnings) from investment in subsidiaries | (115.8 | ) | (115.8 | ) | (144.1 | ) | — |  | 375.7 |  | — |
Other (income) expense: |  |  |  |  |  |
Equity income of unconsolidated subsidiaries | — |  | — |  | — |  | (0.9 | ) | — |  | (0.9 | )
Net interest expense | — |  | — |  | 27.4 |  | 9.0 |  | — |  | 36.4 |
Income (loss) before income taxes | 107.4 |  | 115.8 |  | 115.8 |  | 171.8 |  | (375.7 | ) | 135.1 |
Provision for income taxes | — |  | — |  | — |  | 27.7 |  | — |  | 27.7 |
Net income (loss) | $ | 107.4 |  | $ | 115.8 |  | $ | 115.8 |  | $ | 144.1 |  | $ | (375.7 | ) | $ | 107.4 |
Comprehensive income (loss), net of tax |  |  |  |  |  |
Net income (loss) | $ | 107.4 |  | $ | 115.8 |  | $ | 109.4 |  | $ | 137.7 |  | $ | (362.9 | ) | $ | 107.4 |
Changes in cumulative translation adjustment | 28.0 |  | 28.0 |  | 28.0 |  | 28.0 |  | (84.0 | ) | 28.0 |
Changes in market value of derivative financial instruments | (14.7 | ) | (14.7 | ) | (14.7 | ) | (14.7 | ) | 44.1 |  | (14.7 | )
Comprehensive income (loss) | $ | 120.7 |  | $ | 129.1 |  | $ | 122.7 |  | $ | 151.0 |  | $ | (402.8 | ) | $ | 120.7 |
Condensed Consolidating Balance Sheet March 31, 2016
In millions | Parent Company Guarantor | Subsidiary Guarantor | Subsidiary Issuer | Non-guarantor Subsidiaries | Eliminations | Consolidated Total
Assets
Current assets |  |  |  |  |  |
Cash and cash equivalents | $ | — |  | $ | — |  | $ | — |  | $ | 158.1 |  | $ | — |  | $ | 158.1 |
Accounts and notes receivable, net | — |  | — |  | — |  | 1,268.7 |  | — |  | 1,268.7 |
Inventories | — |  | — |  | — |  | 1,197.7 |  | — |  | 1,197.7 |
Other current assets | 10.0 |  | 6.8 |  | 3.4 |  | 387.2 |  | (26.0 | ) | 381.4 |
Total current assets | 10.0 |  | 6.8 |  | 3.4 |  | 3,011.7 |  | (26.0 | ) | 3,005.9 |
Property, plant and equipment, net | — |  | — |  | — |  | 951.8 |  | — |  | 951.8 |
Other assets |  |  |  |  |  |
Investments in subsidiaries | 4,624.9 |  | 4,609.0 |  | 9,019.4 |  | — |  | (18,253.3 | ) | — |
Goodwill | — |  | — |  | — |  | 5,250.0 |  | — |  | 5,250.0 |
Intangibles, net | — |  | — |  | — |  | 2,461.0 |  | — |  | 2,461.0 |
Other non-current assets | 12.6 |  | 10.5 |  | 1,119.8 |  | 1,132.1 |  | (1,913.5 | ) | 361.5 |
Total other assets | 4,637.5 |  | 4,619.5 |  | 10,139.2 |  | 8,843.1 |  | (20,166.8 | ) | 8,072.5 |
Total assets | $ | 4,647.5 |  | $ | 4,626.3 |  | $ | 10,142.6 |  | $ | 12,806.6 |  | $ | (20,192.8 | ) | $ | 12,030.2 |
Liabilities and Equity
Current liabilities |  |  |  |  |  |
Current maturities of long-term debt and short-term borrowings | $ | — |  | $ | — |  | $ | — |  | $ | 0.7 |  | $ | — |  | $ | 0.7 |
Accounts payable | 0.8 |  | — |  | — |  | 578.2 |  | — |  | 579.0 |
Employee compensation and benefits | 0.7 |  | 0.1 |  | — |  | 221.8 |  | — |  | 222.6 |
Other current liabilities | 71.9 |  | 1.3 |  | 20.4 |  | 597.7 |  | (26.0 | ) | 665.3 |
Total current liabilities | 73.4 |  | 1.4 |  | 20.4 |  | 1,398.4 |  | (26.0 | ) | 1,467.6 |
Other liabilities |  |  |  |  |  |
Long-term debt | 487.6 |  | — |  | 5,509.9 |  | 753.1 |  | (1,913.5 | ) | 4,837.1 |
Pension and other post-retirement compensation and benefits | — |  | — |  | — |  | 285.9 |  | — |  | 285.9 |
Deferred tax liabilities | — |  | — |  | 3.0 |  | 825.7 |  | — |  | 828.7 |
Other non-current liabilities | 2.3 |  | — |  | — |  | 524.4 |  | — |  | 526.7 |
Total liabilities | 563.3 |  | 1.4 |  | 5,533.3 |  | 3,787.5 |  | (1,939.5 | ) | 7,946.0 |
Equity | 4,084.2 |  | 4,624.9 |  | 4,609.3 |  | 9,019.1 |  | (18,253.3 | ) | 4,084.2 |
Total liabilities and equity | $ | 4,647.5 |  | $ | 4,626.3 |  | $ | 10,142.6 |  | $ | 12,806.6 |  | $ | (20,192.8 | ) | $ | 12,030.2 |
Condensed Consolidating Statement of Cash Flows Three months ended March 31, 2016
In millions | Parent Company Guarantor | Subsidiary Guarantor | Subsidiary Issuer | Non-guarantor Subsidiaries | Eliminations | Consolidated Total
Operating activities |  |  |  |  |  |
Net cash provided by (used for) operating activities | $ | 126.6 |  | $ | 99.9 |  | $ | 106.6 |  | $ | 27.6 |  | $ | (375.7 | ) | $ | (15.0 | )
Investing activities |  |  |  |  |  |
Capital expenditures | — |  | — |  | — |  | (38.2 | ) | — |  | (38.2 | )
Proceeds from sale of property and equipment | — |  | — |  | — |  | 6.3 |  | — |  | 6.3 |
Acquisitions, net of cash acquired | — |  | — |  | — |  | (0.1 | ) | — |  | (0.1 | )
Net intercompany loan activity | — |  | — |  | (6.5 | ) | 126.0 |  | (119.5 | ) | — |
Net cash provided by (used for) investing activities | — |  | — |  | (6.5 | ) | 94.0 |  | (119.5 | ) | (32.0 | )
Financing activities |  |  |  |  |  |
Net receipts of short-term borrowings | — |  | — |  | — |  | 0.7 |  | — |  | 0.7 |
Net receipts (repayments) of commercial paper and revolving long-term debt | — |  | — |  | 164.8 |  | (26.4 | ) | — |  | 138.4 |
Repayments of long-term debt | — |  | — |  | — |  | (0.7 | ) | — |  | (0.7 | )
Net change in advances to subsidiaries | (64.9 | ) | (99.9 | ) | (276.4 | ) | (54.0 | ) | 495.2 |  | — |
Excess tax benefits from share-based compensation | — |  | — |  | — |  | 0.5 |  | — |  | 0.5 |
Shares issued to employees, net of shares withheld | (1.6 | ) | — |  | — |  | — |  | — |  | (1.6 | )
Dividends paid | (60.1 | ) | — |  | — |  | — |  | — |  | (60.1 | )
Net cash provided by (used for) financing activities | (126.6 | ) | (99.9 | ) | (111.6 | ) | (79.9 | ) | 495.2 |  | 77.2 |
Effect of exchange rate changes on cash and cash equivalents | — |  | — |  | 11.4 |  | (9.8 | ) | — |  | 1.6 |
Change in cash and cash equivalents | — |  | — |  | (0.1 | ) | 31.9 |  | — |  | 31.8 |
Cash and cash equivalents, beginning of period | — |  | — |  | 0.1 |  | 126.2 |  | — |  | 126.3 |
Cash and cash equivalents, end of period | $ | — |  | $ | — |  | $ | — |  | $ | 158.1 |  | $ | — |  | $ | 158.1 |
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) Three months ended March 28, 2015
In millions | Parent Company Guarantor | Subsidiary Guarantor | Subsidiary Issuer | Non-guarantor Subsidiaries | Eliminations | Consolidated Total
Net sales | $ | — |  | $ | — |  | $ | — |  | $ | 1,475.0 |  | $ | — |  | $ | 1,475.0 |
Cost of goods sold | — |  | — |  | — |  | 964.8 |  | — |  | 964.8 |
Gross profit | — |  | — |  | — |  | 510.2 |  | — |  | 510.2 |
Selling, general and administrative | 3.1 |  | 0.1 |  | 1.1 |  | 304.9 |  | — |  | 309.2 |
Research and development | — |  | — |  | — |  | 29.8 |  | — |  | 29.8 |
Operating income (loss) | (3.1 | ) | (0.1 | ) | (1.1 | ) | 175.5 |  | — |  | 171.2 |
Loss (earnings) from continuing operations of investment in subsidiaries | (120.7 | ) | (121.7 | ) | (118.5 | ) | — |  | 360.9 |  | — |
Other (income) expense: |  |  |  |  |  |
Equity income of unconsolidated subsidiaries | — |  | — |  | — |  | (0.5 | ) | — |  | (0.5 | )
Net interest expense | — |  | 0.9 |  | 3.5 |  | 13.8 |  | — |  | 18.2 |
Income (loss) from continuing operations before income taxes | 117.6 |  | 120.7 |  | 113.9 |  | 162.2 |  | (360.9 | ) | 153.5 |
Provision (benefit) for income taxes | (0.6 | ) | — |  | — |  | 35.9 |  | — |  | 35.3 |
Net income (loss) from continuing operations | 118.2 |  | 120.7 |  | 113.9 |  | 126.3 |  | (360.9 | ) | 118.2 |
Loss from discontinued operations, net of tax | — |  | — |  | — |  | (4.3 | ) | — |  | (4.3 | )
Earnings (loss) from discontinued operations of investment in subsidiaries | (4.3 | ) | (4.3 | ) | (4.3 | ) | — |  | 12.9 |  | — |
Net income (loss) | $ | 113.9 |  | $ | 116.4 |  | $ | 109.6 |  | $ | 122.0 |  | $ | (348.0 | ) | $ | 113.9 |
Comprehensive income (loss), net of tax |  |  |  |  |  |
Net income (loss) | $ | 113.9 |  | $ | 116.4 |  | $ | 109.6 |  | $ | 122.0 |  | $ | (348.0 | ) | $ | 113.9 |
Changes in cumulative translation adjustment | (174.2 | ) | (174.2 | ) | (174.2 | ) | (174.2 | ) | 522.6 |  | (174.2 | )
Changes in market value of derivative financial instruments | (0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | 0.3 |  | (0.1 | )
Comprehensive income (loss) | $ | (60.4 | ) | $ | (57.9 | ) | $ | (64.7 | ) | $ | (52.3 | ) | $ | 174.9 |  | $ | (60.4 | )
Condensed Consolidating Balance Sheet December 31, 2015
In millions | Parent Company Guarantor | Subsidiary Guarantor | Subsidiary Issuer | Non-guarantor Subsidiaries | Eliminations | Consolidated Total
Assets
Current assets |  |  |  |  |  |
Cash and cash equivalents | $ | — |  | $ | — |  | $ | 0.1 |  | $ | 126.2 |  | $ | — |  | $ | 126.3 |
Accounts and notes receivable, net | 0.1 |  | — |  | — |  | 1,167.6 |  | — |  | 1,167.7 |
Inventories | — |  | — |  | — |  | 1,174.3 |  | — |  | 1,174.3 |
Other current assets | 25.2 |  | 12.8 |  | — |  | 309.2 |  | (37.9 | ) | 309.3 |
Total current assets | 25.3 |  | 12.8 |  | 0.1 |  | 2,777.3 |  | (37.9 | ) | 2,777.6 |
Property, plant and equipment, net | — |  | — |  | — |  | 942.8 |  | — |  | 942.8 |
Other assets |  |  |  |  |  |
Investments in subsidiaries | 4,495.6 |  | 4,486.1 |  | 10,151.1 |  | — |  | (19,132.8 | ) | — |
Goodwill | — |  | — |  | — |  | 5,255.4 |  | — |  | 5,255.4 |
Intangibles, net | — |  | — |  | — |  | 2,490.1 |  | — |  | 2,490.1 |
Other non-current assets | 12.6 |  | — |  | 190.1 |  | 352.1 |  | (187.2 | ) | 367.6 |
Total other assets | 4,508.2 |  | 4,486.1 |  | 10,341.2 |  | 8,097.6 |  | (19,320.0 | ) | 8,113.1 |
Total assets | $ | 4,533.5 |  | $ | 4,498.9 |  | $ | 10,341.3 |  | $ | 11,817.7 |  | $ | (19,357.9 | ) | $ | 11,833.5 |
Liabilities and Equity
Current liabilities |  |  |  |  |  |
Current maturities of long-term debt and short-term borrowings | $ | — |  | $ | — |  | $ | — |  | $ | 0.7 |  | $ | — |  | $ | 0.7 |
Accounts payable | 0.6 |  | — |  | 0.3 |  | 577.9 |  | — |  | 578.8 |
Employee compensation and benefits | 0.4 |  | 0.1 |  | — |  | 262.4 |  | — |  | 262.9 |
Other current liabilities | 61.7 |  | 1.5 |  | 27.1 |  | 591.7 |  | (37.9 | ) | 644.1 |
Total current liabilities | 62.7 |  | 1.6 |  | 27.4 |  | 1,432.7 |  | (37.9 | ) | 1,486.5 |
Other liabilities |  |  |  |  |  |
Long-term debt | 453.3 |  | 1.7 |  | 4,535.5 |  | (117.5 | ) | (187.2 | ) | 4,685.8 |
Pension and other post-retirement compensation and benefits | — |  | — |  | — |  | 287.2 |  | — |  | 287.2 |
Deferred tax liabilities | — |  | — |  | 3.1 |  | 841.1 |  | — |  | 844.2 |
Other non-current liabilities | 8.7 |  | — |  | — |  | 512.3 |  | — |  | 521.0 |
Total liabilities | 524.7 |  | 3.3 |  | 4,566.0 |  | 2,955.8 |  | (225.1 | ) | 7,824.7 |
Equity | 4,008.8 |  | 4,495.6 |  | 5,775.3 |  | 8,861.9 |  | (19,132.8 | ) | 4,008.8 |
Total liabilities and equity | $ | 4,533.5 |  | $ | 4,498.9 |  | $ | 10,341.3 |  | $ | 11,817.7 |  | $ | (19,357.9 | ) | $ | 11,833.5 |
Condensed Consolidating Statement of Cash Flows March 28, 2015
In millions | Parent Company Guarantor | Subsidiary Guarantor | Subsidiary Issuer | Non-guarantor Subsidiaries | Eliminations | Consolidated Total
Operating activities |  |  |  |  |  |
Net cash provided by (used for) operating activities | $ | 79.5 |  | $ | 102.4 |  | $ | 107.9 |  | $ | (75.0 | ) | $ | (348.0 | ) | $ | (133.2 | )
Investing activities |  |  |  |  |  |
Capital expenditures | — |  | — |  | — |  | (34.8 | ) | — |  | (34.8 | )
Proceeds from sale of property and equipment | — |  | — |  | — |  | 2.3 |  | — |  | 2.3 |
Acquisitions, net of cash acquired | — |  | — |  | — |  | (3.0 | ) | — |  | (3.0 | )
Intercompany loan activity | — |  | — |  | (468.5 | ) | 163.4 |  | 305.1 |  | — |
Net cash provided by (used for) investing activities of continuing operations | — |  | — |  | (468.5 | ) | 127.9 |  | 305.1 |  | (35.5 | )
Net cash provided by (used for) investing activities of discontinued operations | — |  | — |  | — |  | 54.9 |  | — |  | 54.9 |
Net cash provided by (used for) investing activities | — |  | — |  | (468.5 | ) | 182.8 |  | 305.1 |  | 19.4 |
Financing activities |  |  |  |  |  |
Net receipts (repayments) of commercial paper and revolving long-term debt | — |  | — |  | 406.5 |  | (0.5 | ) | — |  | 406.0 |
Repayments of long-term debt | — |  | — |  | — |  | (0.4 | ) | — |  | (0.4 | )
Net change in advances to subsidiaries | 178.0 |  | (102.4 | ) | (45.8 | ) | (72.7 | ) | 42.9 |  | — |
Excess tax benefits from share-based compensation | — |  | — |  | — |  | 2.8 |  | — |  | 2.8 |
Shares issued to employees, net of shares withheld | — |  | — |  | — |  | 8.7 |  | — |  | 8.7 |
Repurchases of ordinary shares | (200.0 | ) | — |  | — |  | — |  | — |  | (200.0 | )
Dividends paid | (57.5 | ) | — |  | — |  | — |  | — |  | (57.5 | )
Net cash provided by (used for) financing activities | (79.5 | ) | (102.4 | ) | 360.7 |  | (62.1 | ) | 42.9 |  | 159.6 |
Effect of exchange rate changes on cash and cash equivalents | — |  | — |  | — |  | (25.1 | ) | — |  | (25.1 | )
Change in cash and cash equivalents | — |  | — |  | 0.1 |  | 20.6 |  | — |  | 20.7 |
Cash and cash equivalents, beginning of period | — |  | — |  | 0.1 |  | 110.3 |  | — |  | 110.4 |
Cash and cash equivalents, end of period | $ | — |  | $ | — |  | $ | 0.2 |  | $ | 130.9 |  | $ | — |  | $ | 131.1 |

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- Definition The entire disclosure for condensed financial statements. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=18733093&loc=d3e5614-111684 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 10 -Paragraph f -Article 3 + Details
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