Financial Analysis

4. ACQUISITIONS AND DISPOSITIONS Acquisitions The Company makes business acquisitions that align with its strategic business objectives. The assets and liabilities of acquired businesses are recorded in the Consolidated Balance Sheets based on estimates of the fair value of assets acquired, liabilities assumed and noncontrolling interests acquired as of the acquisition date. Goodwill is recognized in the amount that the purchase consideration paid exceeds the fair value of the net assets acquired. Purchase consideration includes both cash paid and the fair value of noncash consideration exchanged, including stock and/or contingent consideration exchanged, and is reduced by the amount of cash or cash equivalents acquired. Acquisitions during 2025, 2024 and 2023 were not significant to the Companys consolidated financial statements; therefore, pro forma financial information is not presented. 2025 Activity Ovivo Electronics Acquisition On December 16, 2025, the Company acquired Ovivo Electronics for total consideration of $1,596 million in cash, net of cash acquired. Ovivo Electronics is a leading and fast-growing global provider of breakthrough ultrapure water technologies for semiconductor manufacturing. The Ovivo Electronics acquisition has been accounted for as a business combination with the assets acquired and liabilities assumed recognized at fair value as of the acquisition date. The fair values of intangible assets acquired were estimated using discounted cash flow ana …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

15. COMMITMENTS AND CONTINGENCIES The Company is subject to various claims and contingencies related to, among other things, workers compensation, general liability (including product liability), automobile claims, health care claims, environmental matters and lawsuits. The Company is also subject to various claims and contingencies related to income taxes, which are discussed in Note 12, Income Taxes. The Company also has contractual obligations including lease commitments, which are discussed in Note 13, Rentals and Leases. The Company records liabilities when a contingent loss is probable and can be reasonably estimated. If the reasonable estimate of a probable loss is a range, the Company records the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. The Company discloses a contingent liability even if the liability is not probable or the amount is not estimable, or both, if there is a reasonable possibility that a material loss may have been incurred. Insurance Globally, the Company has insurance policies with varying deductible levels for property and casualty losses. The Company is insured for losses in excess of these deductibles, subject to policy terms and conditions and has recorded both a liability and an offsetting receivable for amounts in excess of these deductibles. The Company is self-insured for health care claims for eligible participating employees, subject to certain deducti …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

6. DEBT AND INTEREST Short-term Debt The following table provides the components of the Companys short-term debt obligations, along with applicable interest rates as of December 31, 2025 and 2024: 2025 2024 Average Average Carrying Interest Carrying Interest (millions) Value Rate Value Rate Short-term debt Commercial paper $100.0 3.90 % $- - % Notes payable 11.0 3.94 % 3.6 7.28 % Long-term debt, current maturities 759.4 612.1 Total $870.4 $615.7 Line of Credit As of December 31, 2024, the Company had in place a $2.0 billion multi-currency revolving credit facility which was due to expire in April 2026. In March 2025, the Company entered into an amended and restated credit facility which extended the maturity from April 2026 to March 2030. The credit facility has been established with a diverse syndicate of banks and supports the Companys U.S. and Euro commercial paper programs. There were no borrowings under the Companys credit facility as of December 31, 2025 and 2024. The Company has $428 million of available bank supported letters of credit, surety bonds and guarantees available in support of its commercial business transactions of which $217 million is outstanding as of December 31, 2025. Commercial Paper The Companys commercial paper program is used as a potential source of liquidity and consists of a $2.0 billion U.S. commercial paper program and a $2.0 billion Euro commercial paper program. The maximum aggregate amount of commercial paper that may be issued by the Comp …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

(millions) 2025 2024 2023 Global Water Product and sold equipment $6,958.7 $6,809.6 $6,709.8 Service and lease equipment 1,023.7 966.3 915.7 Global Institutional & Specialty Product and sold equipment 4,950.4 5,000.0 4,920.5 Service and lease equipment 1,154.2 1,103.4 990.3 Global Pest Elimination Product and sold equipment - - - Service and lease equipment 1,246.3 1,162.8 1,066.0 Global Life Sciences Product and sold equipment 709.4 664.0 644.0 Service and lease equipment 38.5 35.3 31.4 Corporate Product and sold equipment - - 42.5 Total Total product and sold equipment $12,618.5 $12,473.6 $12,316.8 Total service and lease equipment 3,462.7 3,267.8 3,003.4 Net sales at public exchange rates by geographic region were as follows: Global Water Global Institutional & Specialty (millions) 2025 2024 2023 2025 2024 2023 United States $3,415.1 $3,306.7 $3,218.1 $3,996.0 $3,992.0 $3,856.9 Europe 1,661.1 1,593.7 1,573.0 1,026.1 1,037.5 1,033.2 Asia Pacific 945.7 947.6 946.4 329.2 322.4 308.2 Latin America 816.7 810.5 772.5 205.8 209.6 212.0 India, Middle East and Africa 501.1 493.0 491.8 99.1 105.1 98.6 Greater China 410.4 400.4 407.0 198.1 182.7 165.7 Canada 232.3 224.0 216.7 250.3 254.1 236.2 Total $7,982.4 $7,775.9 $7,625.5 $6,104.6 $6,103.4 $5,910.8 Global Pest Elimination Global Life Sciences (millions) 2025 2024 2023 2025 2024 2023 United States $864.0 $805.6 $733.6 $205.1 $187.3 $187.2 Europe 205.7 187.5 171.0 382.4 374.4 368.6 Asia Pacific 35.1 32.1 28.7 54.5 37.2 33.9 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

11. EQUITY COMPENSATION PLANS The Companys equity compensation plans provide for grants of stock options, performance-based restricted stock units (PBRSUs) and non-performance-based restricted stock units (RSUs) and restricted stock awards (RSAs). Common shares available for grant as of December 31, 2025, 2024 and 2023 were 17,081,775, 18,052,830 and 18,840,265, respectively. The Company generally issues authorized but previously unissued shares to satisfy stock option exercises and stock award vesting. The Companys annual long-term incentive share-based compensation program is made up of 40% stock options and 60% PBRSUs for 2025, 2024 and 2023. The Company also periodically grants RSUs. Total compensation expense related to all share-based compensation plans was $136.6 million, $134.8 million and $95.1 million for 2025, 2024 and 2023, respectively. As of December 31, 2025, there was $196.3 million of total measured but unrecognized compensation expense related to non-vested share-based compensation arrangements granted under all of the Companys plans. That cost is expected to be recognized over a weighted-average period of 2.0 years. Stock Options Stock options are granted to purchase shares of the Companys stock at the average daily share price on the date of grant. These options generally expire within ten years from the grant date. The Company generally recognizes compensation expense for these awards on a straight-line basis over the three year vesting period. Stock opti …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

7. FAIR VALUE MEASUREMENTS The Companys financial instruments include cash and cash equivalents, accounts receivable, accounts payable, contingent consideration obligations, commercial paper, notes payable, foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative contracts and long-term debt. Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. The hierarchy is broken down into three levels: Level 1 - Inputs are quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2 - Inputs include observable inputs other than quoted prices in active markets. Level 3 - Inputs are unobservable inputs for which there is little or no market data available. The carrying amount and the estimated fair value for assets and liabilities measured on a recurring basis were: December 31, 2025 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $17.4 $- $17.4 $- Cross-currency swap derivative contracts 11.4 - 11.4 - Liabilities Foreign currency forward contracts 20.3 - 20.3 - Int …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

12. INCOME TAXES Income before income taxes consisted of: (millions) 2025 2024 2023 United States (U.S.) $1,815.3 $1,522.4 $782.0 International 732.6 1,048.8 973.5 Total $2,547.9 $2,571.2 $1,755.5 Presentation of prior year amounts relating to U.S. and International income before taxes have been recast to conform with the current year presentation, which is before intercompany eliminations. As a result, prior year amounts presented for U.S. and International current and deferred taxes have also been recast to conform with the current year presentation. This had no effect on the reported results of operations. The provision (benefit) for income taxes consisted of: (millions) 2025 2024 2023 U.S. federal and state $265.3 $278.4 $158.6 International 225.5 345.5 259.0 Total current 490.8 623.9 417.6 U.S. federal and state (5.5) (127.0) (34.7) International (30.7) (57.6) (20.4) Total deferred (36.2) (184.6) (55.1) Total U.S. federal and state 259.8 151.4 123.9 Total International 194.8 287.9 238.6 Total provision for income taxes $454.6 $439.3 $362.5 The Companys overall net deferred tax assets and deferred tax liabilities were comprised of the following: December 31 (millions) 2025 2024 Deferred tax assets Pension and post-retirement benefits $32.5 $68.2 Other accrued liabilities 155.9 152.5 Lease liability 181.4 176.7 Credit carryforwards 132.2 105.1 Capitalization of R&D costs 270.7 246.5 Loss carryforwards 189.8 92.9 Share-based compensation 61.1 54.2 Deferred income 88.6 7 …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

New Accounting Pronouncements Standards That Are Not Yet Adopted: Date of Required Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2024-03 and ASU 2025-01 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses November 2024 The amendments in this ASU are intended to improve expense disclosures, primarily by requiring disclosure of disaggregated information about certain income statement expense line items on an annual and interim basis. Effective for annual reporting periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The updates provides for adoption on a prospective basis, but retrospective application is permitted. The Company is currently evaluating the impact of adoption and additional disclosure requirements. ASU 2025-06 (Topic 350): Targeted Improvements to the Accounting for Internal-Use Software September 2025 The amendments modernize the recognition and disclosure framework for internal-use software costs, removing the previous development stage model and introducing a more judgment-based approach. Effective for annual reporting periods beginning after December 15, 2027 and interim reporting periods within annual reporting periods. Early adoption is permitted. The update provides for adoption on a prospective basis, with retrospe …

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16. RETIREMENT PLANS Pension and Postretirement Health Care Benefits Plans The Company has a non-contributory, qualified, defined benefit pension plan covering the majority of its U.S. employees. The Company also has U.S. non-contributory, non-qualified, defined benefit pension plans, which provide for benefits to employees in excess of limits permitted under its pension plans. The U.S. non-qualified plans are not funded and the recorded benefit obligations for the non-qualified plans were $79 million and $78 million at December 31, 2025 and 2024, respectively. The U.S. qualified obligation was $1,738 million and $1,712 million at December 31, 2025 and 2024, respectively. The measurement date used for determining the U.S. pension plan assets and obligations is December 31. Various international subsidiaries have defined benefit pension plans. International plans are funded based on local country requirements. The measurement date used for determining the international pension plan assets and obligations is November 30, the fiscal year end of the Companys international subsidiaries. The Company provides postretirement health care and life insurance benefits to certain U.S. employees and retirees. The U.S. postretirement health care plans are contributory based on years of service and choice of coverage (family or single), with retiree contributions adjusted annually. The Company also maintains several U.S. postretirement life insurance plans. The measurement date used to deter …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

17. REVENUES Revenue Recognition Product and Sold Equipment Product revenue is generated from sales of cleaning, sanitizing, water treatment, process treatment and colloidal silica products. In addition, the Company sells equipment which may be used in combination with its specialized products. Revenue from product and sold equipment is recognized when obligations under the terms of a contract with the customer are satisfied, which generally occurs with the transfer of the product or delivery of the equipment. Service and Lease Equipment Service and lease equipment revenue is generated from providing services or leasing equipment to customers. Service offerings include installing or repairing certain types of equipment, activities that supplement or replace headcount at the customer location, or fulfilling deliverables included in the contract. Global Water segment services are associated with water treatment and paper process applications. Global Institutional & Specialty segment services include cleaning and sanitizing programs and wash process solutions. Global Life Sciences segment services include pharmaceutical and personal care solutions. Revenues included in Global Pest Elimination primarily relate to services designed to detect, eliminate and prevent pests. Revenue from service and leased equipment is recognized when the services are provided, or the customer receives the benefit from the leased equipment, which is over time. Service revenue is recognized over ti …

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"18. OPERATING SEGMENTS AND GEOGRAPHIC INFORMATION The Companys organizational structure consists of global business units and market-based leadership teams. The Companys seven operating segments follow its commercial and product-based activities and are based on engagement in business activities, availability of discrete financial information and review of operating results by the Chief Operating Decision Maker (CODM) at the identified operating segment level. The CODM is the Companys Chief Executive Officer. The Companys operating segments that share similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment have been aggregated into four reportable segments: Global Water, Global Institutional & Specialty, Global Pest Elimination and Global Life Sciences The Companys operating segments are aggregated as follows: Global Water Includes the Light & Heavy, Food & Beverage and Paper operating segments, which provide water treatment and process applications, and cleaning and sanitizing solutions, primarily to large industrial customers within the manufacturing, food and beverage processing, transportation, chemical, primary metals and mining, power generation, global refining, petrochemical, pulp and paper industries. The underlying operating segments exhibit similar manufacturing processes, distribution methods and economic characteristics. Global Institu …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

2. SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include the accounts of the Company and all subsidiaries in which the Company has a controlling financial interest. Investments in companies, joint ventures or partnerships in which the Company does not have control but has the ability to exercise significant influence over operating and financial decisions, are reported using the equity method of accounting. The measurement alternative is used for investments in companies, joint ventures and partnerships over which the Company has neither control nor significant influence and for which the investment does not have a readily determinable fair value. Under the measurement alternative, investments are recorded at cost and adjusted for impairments, if any, or observable price changes. International subsidiaries are included in the financial statements on the basis of their U.S. GAAP November 30 fiscal year ends to facilitate the timely inclusion of such entities in the Companys consolidated financial reporting. All intercompany transactions and profits are eliminated in consolidation. Use of Estimates The preparation of the Companys financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from thes …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

10. SHAREHOLDERS EQUITY Authorized common stock, par value $1.00 per share, was 800 million shares at December 31, 2025, 2024 and 2023. Treasury stock is stated at cost. Dividends declared per share of common stock were $2.68 for 2025, $2.36 for 2024 and $2.16 for 2023. The Company has 15 million shares, without par value, of authorized but unissued and undesignated preferred stock. Share Repurchase Authorization In November 2022, the Companys Board of Directors authorized the repurchase of up to 10,000,000 shares of its common stock, including shares to be repurchased under Rule 10b5-1. As of December 31, 2025, 5,896,821 shares remained to be repurchased under the Companys repurchase authorization. The Company intends to repurchase all shares under its authorization, for which no expiration date has been established, in open market or privately negotiated transactions, subject to market conditions. Share Repurchases During 2025, 2024 and 2023, the Company reacquired 2,994,702, 4,246,642 and 83,674 shares, respectively, of its common stock, of which 2,884,764, 4,135,512 and 0, respectively, related to share repurchases through open market or private purchases, and 109,938, 111,130 and 83,674, respectively, related to shares withheld for taxes on exercise of stock options and vesting of stock awards and units. …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing