Watts Water Technologies (WTS) FY2023 results: revenue $2.1 billion, up 3.9% on the year

Watts Water Technologies Inc. (WTS) reported revenue of $2.1 billion for fiscal 2023, the year ended 31 December 2023, up 3.9% on the year before. Net income was $262 million, up 4.2%, and diluted earnings per share $7.82. The figures are the company's own, from the 10-K it filed with the SEC on 21 February 2024.

Revenue

$2.1 billion

+3.9% on the year

FY2016FY2023

Operating margin

17.1%

15.9% a year earlier

FY2016FY2023

Net income

$262 million

+4.2% on the year

FY2016FY2023

Diluted EPS

$7.82

+4.5% on the year

FY2016FY2023

this yearthe year beforeHover a bar for its figure.

The year in brief

The four quarters: Q1 FY2023 · Q2 FY2023 · Q3 FY2023 · Q4 FY2023

Income statement (profit and loss)

$ million	FY2023	FY2022	FY2021	On the year
Revenue	2,056	1,980	1,809	+3.9%
Cost of revenue	1,095	1,105	1,042	-0.9%
Gross profit	961	874	767	+9.9%
Gross margin	46.7%	44.2%	42.4%
Research and development	67.1	59.4	45.6	+13.0%
Selling, general and administrative	604	549	508	+10.2%
Operating income	351	315	240	+11.4%
Operating margin	17.1%	15.9%	13.2%
Interest expense	8.2	7.0	6.3	+17.1%
Pre-tax income	350	308	234	+13.6%
Income tax	87.4	56.1	68.4	+55.8%
Effective tax rate	25.0%	18.2%	29.2%
Net income	262	252	166	+4.2%
Net margin	12.7%	12.7%	9.2%
Diluted EPS	$7.82	$7.48	$4.88	+4.5%

$ million except per share.

Free cash flow is operating cash flow less capital expenditure; the effective tax rate is income tax over pre-tax income; margins are the line over revenue. Gross profit is revenue less cost of revenue, and operating income is revenue less the company's own total costs, where the statement does not print those lines. Those four are arithmetic on the filed numbers; everything else is as filed. Money is in $ million as the company files it, or in $ billion by the switch above the tables; per share figures and share counts are as they are.

Cash flow

$ million	FY2023	FY2022	FY2021	On the year
Operating cash flow	311	224	181	+38.8%
Capital expenditure	29.7	28.1	26.7	+5.7%
Free cash flow	281	196	154	+43.5%
Free cash flow margin	13.7%	9.9%	8.5%
Cash from investing	-343	-22.9	-30.7
Cash from financing	69.0	-122	-119
Depreciation and amortisation	43.3	39.7	45.1	+9.1%
Share-based compensation	20.2	18.4	22.9	+9.8%
Buybacks	16.0	69.4	16.0	-76.9%
Dividends paid	46.5	39.5	34.3	+17.7%
Dividend per share	$1.38	$1.16	$1.01	+19.0%
Diluted shares, weighted	34m	34m	34m	-0.3%

Balance sheet

$ million	FY2023	FY2022	FY2021	On the year
Shareholders' equity	1,513	1,301	1,173	+16.4%
Debt	298	148	142	+102.1%
Operating lease liabilities	43.8	38.1	42.0	+15.0%
Finance lease liabilities	1.2	1.4	1.9	-14.3%
Other liabilities	453	443	497	+2.2%
Total liabilities and equity	2,309	1,931	1,856	+19.6%
Fixed assets	248	197	201	+26.1%
Goodwill	693	592	601	+17.0%
Intangible assets	216	114	129	+90.1%
Cash and equivalents	350	311	242	+12.6%
Receivables	260	234	221	+11.1%
Inventory	399	376	371	+6.3%
Other assets	143	108	92.0	+32.6%
Total assets	2,309	1,931	1,856	+19.6%

10-K for the year ended 31 December 2023, filed 21 February 2024: the filing.