Watts Water Technologies Inc. Files 2023 Annual Report (10-K)

TL;DR

<b>Watts Water Technologies Inc. has filed its 2023 10-K annual report detailing its financial performance and business operations.</b>

AI Summary

WATTS WATER TECHNOLOGIES INC (WTS) filed a Annual Report (10-K) with the SEC on February 21, 2024. The company filed its 10-K annual report for the fiscal year ending December 31, 2023. The filing covers the period from January 1, 2023, to December 31, 2023. Watts Water Technologies Inc. is classified under SIC code 3490 (Miscellaneous Fabricated Metal Products). The company's principal executive offices are located at 815 Chestnut St, North Andover, MA. The report includes details on various stock incentive plans and operating lease arrangements.

Why It Matters

For investors and stakeholders tracking WATTS WATER TECHNOLOGIES INC, this filing contains several important signals. This 10-K filing provides a comprehensive overview of Watts Water Technologies' financial health, operational strategies, and risk factors for the fiscal year 2023, crucial for investors to assess the company's performance and future outlook. The detailed information on stock incentive plans and operating leases offers insights into executive compensation and the company's long-term financial commitments, which can impact profitability and shareholder value.

Risk Assessment

Risk Level: medium — WATTS WATER TECHNOLOGIES INC shows moderate risk based on this filing. The company's business is subject to various risks, including those related to asbestos litigation and potential restructuring settlements, as indicated by the specific financial disclosures within the filing.

Analyst Insight

Investors should review the detailed financial statements and risk factors in the 10-K to understand the company's performance and potential challenges in the upcoming fiscal year.

Key Numbers

• 20231231 — Fiscal Year End (Conformed Period of Report)
• 20240221 — Filing Date (Filed as of Date)
• 127 — Public Document Count (Public Document Count)
• 27352701 — Value 1 (Value related to financial reporting)
• 27314679 — Value 2 (Value related to financial reporting)

Key Players & Entities

• WATTS WATER TECHNOLOGIES INC (company) — Filer name
• 0000795403 (company) — Central Index Key
• 3490 (company) — Standard Industrial Classification
• DE (company) — State of Incorporation
• 815 CHESTNUT ST (company) — Business Address Street 1
• NORTH ANDOVER (company) — Business Address City
• MA (company) — Business Address State
• 01845 (company) — Business Address ZIP

FAQ

Risk Factors

• Restructuring Settlement and Impairment Provisions [medium — financial]: The company has provisions for restructuring settlements and impairments, which can impact financial results.
• Asbestos Litigation [medium — legal]: The company is involved in asbestos litigation, which may result in significant liabilities.

Key Dates

• 2023-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K.
• 2024-02-21: Filing Date — Date the 10-K was officially filed with the SEC.

Glossary

10-K

An annual report required by the U.S. Securities and Exchange Commission (SEC), which gives a comprehensive summary of a company's financial performance. (This filing provides the official annual financial and business overview for Watts Water Technologies Inc.)

Key Financial Figures

• $0.10 — stered Class A common stock, par value $0.10 per share WTS New York Stock Exchan
• $440.4 m — es. Our top ten customers accounted for $440.4 million, or 21.4%, of our total net sales
• $431.7 m — 21.4%, of our total net sales in 2023; $431.7 million, or 21.8%, of our total net sales
• $371.5 m — 8%, of our total net sales in 2022; and $371.5 million, or 20.5%, of our total net sales

Filing Documents

• wts-20231231x10k.htm (10-K) — 4121KB
• wts-20231231xex4.htm (EX-4) — 7KB
• wts-20231231xex10d8.htm (EX-10.8) — 102KB
• wts-20231231xex10d21.htm (EX-10.21) — 55KB
• wts-20231231xex10d23.htm (EX-10.23) — 16KB
• wts-20231231xex10d24.htm (EX-10.24) — 17KB
• wts-20231231xex21.htm (EX-21) — 68KB
• wts-20231231xex23.htm (EX-23) — 3KB
• wts-20231231xex31d1.htm (EX-31.1) — 9KB
• wts-20231231xex31d2.htm (EX-31.2) — 10KB
• wts-20231231xex32d1.htm (EX-32.1) — 5KB
• wts-20231231xex32d2.htm (EX-32.2) — 5KB
• wts-20231231xex97.htm (EX-97) — 57KB
• wts-20231231x10k002.jpg (GRAPHIC) — 67KB
• wts-20231231xex97001.jpg (GRAPHIC) — 6KB
• 0001558370-24-001444.txt (&nbsp;) — 18901KB
• wts-20231231.xsd (EX-101.SCH) — 93KB
• wts-20231231_cal.xml (EX-101.CAL) — 100KB
• wts-20231231_def.xml (EX-101.DEF) — 483KB
• wts-20231231_lab.xml (EX-101.LAB) — 936KB
• wts-20231231_pre.xml (EX-101.PRE) — 739KB
• wts-20231231x10k_htm.xml (XML) — 4168KB

BUSINESS

BUSINESS 3 Item 1A.

RISK FACTORS

RISK FACTORS 17 Item 1B. UNRESOLVED STAFF COMMENTS 26 Item 1C. CYBERSECURITY 27 Item 2.

PROPERTIES

PROPERTIES 28 Item 3.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 29 Item 4. MINE SAFETY DISCLOSURES 29 PART II Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 30 Item 6. [RESERVED] 31 Item 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 32 Item 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 46 Item 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 46 Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 47 Item 9A.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 47 Item 9B. OTHER INFORMATION 48 Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 48 PART III Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 48 Item 11.

EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION 48 Item 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 49 Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 49 Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 49 PART IV Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES 50 Item 16. FORM 10-K SUMMARY. 50 EXHIBIT INDEX 94

SIGNATURES

SIGNATURES 97 2 Table of Contents This Annual Report on Form 10-K contains statements that are not historical facts and are considered forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements contain projections of our future results of operations or our financial position or state other forward-looking information. In some cases, you can identify these forward-looking statements by words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," and "would" or similar words. You should not rely on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, some of which are beyond our control. These risks, uncertainties and other factors may cause our actual results, performance or achievements to differ materially from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Some of the factors that might cause these differences are described under Item 1A—"Risk Factors." You should carefully review all of these factors, and you should be aware that there may be other factors that could cause these differences. These forward-looking statements were based on information, plans and estimates at the date of this report, and, except as required by law, we undertake no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes. PART I

BUSINESS

Item 1. BUSINESS. In this Annual Report on Form 10-K, references to "the Company," "Watts Water," "Watts," "we," "us" or "our" refer to Watts Water Technologies, Inc. and its consolidated subsidiaries. Overview Watts Regulator Co. was founded by Joseph E. Watts in 1874 in Lawrence, Massachusetts. Watts Regulator Co. started as a small machine shop supplying parts to the New England textile mills of the 19th century. Since then, Watts has grown into a global manufacturer and become one of the world's leading providers of water technologies and solutions that are designed to promote safety, energy efficiency, and water conservation for commercial and residential buildings. Watts Water Technologies, Inc. was incorporated in Delaware in 1985 and is the parent company of Watts Regulator Co. Our strategy is to be the preferred supplier of differentiated solutions, systems and products that manage and conserve the flow of fluids and energy into, through and out of buildings in the commercial and residential markets of the Americas, Europe, and Asia-Pacific, Middle East and Africa ("APMEA"), our three geographic segments. Within this framework, we focus upon three themes: safety and regulation, energy efficiency and water conservation. This strategy provides us with a platform to increase our earnings through sales growth, both organic and inorganic, and the systematic reduction of manufacturing costs and operational expenses. Our strategy is to expand organically by introducing new, complementary products and solutions in existing markets, by enhancing our preferred brands, by promoting plumbing code development to drive the need for safety and quality products and by continually improving merchandising in our wholesale and retail distribution channels. We focus on selling solutions to our customers that integrate a variety of our product offerings. We target selected new products and geographic markets based on growth potential, including our ability to leverage o

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View this 10-K filing on SEC EDGAR