Before we begin, let me remind you that any statements made about the company’s anticipated financial results are forward-looking statements subject to future risks and uncertainties, such as the risks outlined in Pentair’s 10-K as of December 31, 2010, and today’s release. Forward-looking statements included herein are made as of today, 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.Today’s webcast is accompanied by a presentation, which can be found in the Financial Information section of Pentair’s website at www.pentair.com. We will reference these slides throughout our prepared remarks. Any references to non-GAAP financials are reconciled in the appendix of the presentation. I would also like to point out that all financial results and references to year-over-year numbers in today’s call and presentation are on a continuing operations basis, and comparative with adjusted figures, unless otherwise noted or highlighted. The third quarter 2011 adjustments included acquisition related costs and restructuring charges of totally $0.07 of EPS again as outlined in the release this morning. We will have time for Q&A with investors and analysts after our prepared remarks. With that, I’ll hand the call over to Randy. Randy? Randy Hogan Thanks Sara and welcome everyone. Let me begin with Q3 results as shown on slide 2 of the deck. Pentair delivered a solid quarter with sales up 15%, adjusted operating profits up 11% and adjusted EPS of $0.58 up 5% from the prior year. We posted this sales growth in both segments with Water up 20%, and Technical Products up 6%. A good indication that innovation continues to pay off, fast growth region sales remains strong and CPT is off to a great start. We continue to drive demand for our products innovation focused on sustainability, energy efficiency, automation and safety together with strong focus on quality and delivery. U.S. residential sales for example grew 8% in the quarter and 6% year-to-date even without a notable end-market recovery. In fast growth regions, we continue to see good growth with sales up 22% in the quarter before including CPT. Latin America, India and Southeast Asia results stood out in the quarter.
Fast growth regions are approaching 20% of our total sales mix of 2011 compared to less than 15% just one year ago. And finally CPT sales grew nearly 25% from their prior year in local currency. With CPT now in the fold, we’re excited about the many growth opportunities ahead. Turning to margins, we said we’d get pricing and we did. 2% in both Water, and Technical Products. Pricing combined with the relentless focus on productivity more than offset inflation in the quarter.As we anticipated CPT temporarily pressured overall margins, but did show sequential improvements on its own from Q2. The below line item tax and interests were in line with expectations. On earnings we delivered adjusted EPS of $0.58 at the high end of the guidance we provided in July, and we now have the most difficult GIWW comparison behind us. We enter Q4 with many things working for us and in our control, including pricing, innovation, and increasing scale in fast growth regions. The end-markets we serve however continue to be mixed. Our updated full-year outlook range of $2.44 to $2.47 reflects both of these realities. Simply put we’re raising the bottom end of the range, reflecting our solid performance and taking $0.03 of the top end of the range to reflect less of a market contribution from mainly Europe. On free cash flow, we generated $70 million in the quarter keeping us on track to deliver more than 100% conversion in net income for the full-year. Overall, we had a solid quarter and we are well positioned to deliver greater than 20% earnings growth for 2011. Now let’s turn to slide three for review of our Water business. Water revenues grew 20% in the quarter reflecting good growth across most of our businesses. The CPT acquisition contributed 17 points of this growth adding roughly $90 million in sales in the quarter. Volume is down 1% year-over-year reflecting the tough comparisons with the large GIWW projects. Recurring volume growth actually accelerated a 5% in the quarter from 4% in Q2, reflecting continued momentum in fast growth regions, innovation, and distribution gains.
By global business unit or GBU, residential flow continues its strong performance with sales up 15% in the quarter including three points of FX benefits. U.S. residential pump sales grew double-digits in the quarter helped by a strong flood season. Excellent operating performance by the team enabled us to service customers flood demand in efficient and profitable way. Pump sales in Europe moderated from first half but still grew in the third quarter.Our agricultural lines including irrigation pumps and cross-spray products continued their double-digit growth trend growing 18% in the quarter and showing some nice added traction in Brazil. Residential filtration sales grew 5% in the quarter with FX contributing roughly two points. We continue to transform this business into one that is more global, with more point of use filtration and higher efficiency product offerings. In the developed market, our move towards more salt and energy efficient products and channel partner expansion helped to partially offset channel and discretionary spend pressures in the U.S., and Europe. Fast growth regions grew over 20% in this business. India and Latin American sales virtually doubled in the quarter with more in-country for-country innovation and increased distribution coverage. To further support growth in India, we recently expanded our partnership with Eureka Forbes, a leading consumer company in India with a 7,500 strong direct sales force. Strengthening our foothold in the reverse osmosis market in India at the same time leveraging our goal of production capabilities. Read the rest of this transcript for free on seekingalpha.com