WATTS WATER TECHNOLOGIES, INC.

CORPORATE PRESENTATIONCORPORATE PRESENTATION

2009

0

Forward-looking statementsForward looking statements

Certain statements in this presentation constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

These statements are related to forecasts of sales, earnings, earnings per share, water market growth, management goals and objectives.

Watts cautions investors that any such forward-looking statements made by Watts are not guarantees of future performance. All forward-looking statements are subject to known and g p g junknown risks, uncertainties and contingencies, many that are beyond the control of Watts, which may cause actual results, performance or achievements to differ materially from anticipated future results, performance or achievements expressed or implies by the forward-looking statements.

Factors that might affect forward-looking statements include overall economics and business conditions, competitive factors, changes in laws affecting Watts, future acquisitions of material assets or businesses by Watts, the demand for Watts’ products and services and other factors identified in Watts’ most recent Annual Report on Form 10-K and subsequent reports filed with the SECreports filed with the SEC.

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Watts overview – who we areW tt i l d i t l t d d tWatts is a leader in water-related products

$1.5bn in sales for 2008

$64.8mm in income from operations for 2008 (excluding restructuring and goodwill ( g g gimpairment)

$47.2mm in income from operations for 2008 (GAAP)

Mix split between residential and commercialMix split between residential and commercial

45% of sales currently outside of U.S.

Replacement business significant

1874

Today

Sales in over 100

1985 19991986 1996$124MSales: $137M $730M including municipal

$644M l di i i l$800M pre-spin$475M i1874

Founded First Acquisition

Initial Public Offering

Focus on water

Sales in over 100 countries

Manufacturing in 11 countries

6,300 employees

Exited municipal market

$644M excluding municipal $475M post-spin

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6, p y

BATHROOMThermostatic Tempering Valves for Tubs, Showers and SinksElectric Tile Warming

What we do - Water by Watts(Residential Applications)

gQuarter Turn Stop ValvesHot Water Demand Recirculation SystemsDecorative FaucetsBath Waste DrainsP-TrapsToilet Ball Cock Valves

KITCHENReverse Osmosis Water Filtration SystemsThermostatic Mixing ValvesElectric Tile Warming Toilet Ball Cock Valves

LAUNDRY ROOMWashing Machine Shutoff ValvesW t H A t

gFlexible Connectors for Faucets, Dishwashers and Ice MakersIce Maker Filtration SystemsQuarter Turn Stop ValvesMetal & Plastic Tubular Products Water Hammer Arrestors

Flexible Connectors for Faucets and Washing MachinesGas Ball Valves

Products

RADIANT HEAT PRODUCTSRadiant Underfloor Heating S t

BOILERTemperature and Pressure GaugesTempering ValvesSafety Relief ValvesSystems

SnowmeltingElectronic Temperature Controls Quick Connect Fittings

WATER HEATER

Safety Relief ValvesFill ValvesBackflow PreventersBoiler DrainsAir SeparatorsFlow Control ValvesP V l

Hydrocontrol PanelsPEX TubingManifolds

3

T&P Relief ValvesTempering ValvesPressure Reducing ValvesExpansion TanksWater Detector Shutoffs

Backflow PreventersBall ValvesDrain TubesFloor DrainsGas Connectors

Purge ValvesFloat Vents

HVAC SYSTEMBalancing ValvesFeed Water RegulatorsBackflow PreventersR di t U d fl H ti

ManifoldsElectronic Temperature ControlsSafety Relief Valves

What we do - Water by Watts(Commercial Applications)

Radiant Underfloor Heating SystemsRadiant Snowmelting SystemsHydrocontrol PanelsPEX Plumbing System

WASTEWATER (DRAINAGE) SYSTEMRoof DrainsFloor DrainsTrench Drains

CleanoutsInterceptorsHydrants

Safety Relief ValvesAutomatic Air Vent ValvesExpansion TanksTempering ValvesFlow SwitchesGauges &

IRRIGATION SYSTEMBackflow Preventers

Fixture CarriersAcid Waste Systems

yThermometersSteam TrapsStrainersGas Connectors

FOOD SERVICE APPLICATIONSBackflow PreventersBackflow EnclosuresAutomatic Control ValvesThrough-the-Wall ShutoffsBall Valves

Movable Gas ConnectorsWater Filtration SystemsInternal Fluid Conveyance AssembliesGas and Water Shutoff ValvesCommercial FaucetsM t l & Pl ti T b l P tButterfly Valves

Relief ValvesWater Pressure Reducing Valves

Metal & Plastic Tubular PartsGas RegulatorsThermostatic Mixing ValvesGrease InterceptorsFloat ValvesEquipment Placement Systems

FIRE PROTECTION SYSTEMBackflow PreventersTransition Risers

UL/FM Fire Service StrainersAutomatic Control Valves Pre-Engineered Valve Stations

POTABLE WATER SYSTEMGas ConnectorsPEX Plumbing SystemsReverse Osmosis WaterFiltration System

Ball ValvesT&P Relief ValvesTempering ValvesWater ConnectorsShower Valves

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gRelief ValvesCheck ValvesGate Valves

Water SoftenersBackflow PreventersPre-Engineered Valve StationsWater Pressure Reducing ValvesGate, Globe & Check Valves

Monitoring and Turbidity MonitorsStrainersButterfly ValvesAnti-Scale Systems

Pure play global leader in water

Why invest in Watts?

Highly attractive market fundamentals in waterIncreasing energy costs are a revenue driver

Attractive franchiseLeading brands in growing categoriesComprehensive product offering and distribution capabilitySignificant recurring revenue streamLow cost/Lean manufacturing strategyLow cost/Lean manufacturing strategy

Strong growth storyProven industry consolidatorIncreasing international and emerging market presenceIncreasing international and emerging market presenceSuccess in code development and enforcementCapital structure provides stabilityCash flow supports growth

Solid foundation

Diversified business model provides stable platform for growth

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Large and attractive market

Demand for water growing at 3x population growth and will grow by 40% by 2020

Current global market size $365bn+ Key market growth drivers

Components/

Equipment

Purification/

FiltrationSystems Services Operations

growth and will grow by 40% by 2020

Increasing requirements for energy and water conservation

Alternative fuels to heat water require Watts’

Municipal

Alternative fuels to heat water require Watts technology

Increasingly stringent industry codes and potential for legislative action

Industrial

Asian infrastructure inadequate to support growing population and economic development

Residential filtration market already estimated at ~$1.25 billion with solid long-term growth

Commercial

Residential $ g g

New drain platform in Europe

Watts addressable market > $60 billion

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Brand Leverage

Brand

Premium brands allow for premium pricing and input cost recapture

D l l d i Develop complementary products in existing markets

Brand name expansion to new markets through acquisitions

P dProducts

Unparalleled product breadth

Long-standing tradition of product quality

I ti d t d ig

Codes

Innovative product design

Focus on meeting local code requirements

Promote code adoption and enforcement to create entry barriers

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Global distribution capability with limited customer concentration

ChinaNorth American RetailNorth American

concentration

China$37mm/3%

North American Retail$167mm/12%

Wholesale$639mm/46%

European OEM$228mm/16%

European Wholesale$298mm/22%

European DIY$18mm/1%

8Fourth quarter 2008 annualized

Global Manufacturing Footprint

Substantial presence in low cost regions

Implementing Lean techniques

Plant consolidationsPlant consolidations

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Watts is uniquely placed to successfully capitalize on industry trendsindustry trends

Industry trends Watts advantage

Disciplined acquisition strategy with proven track record

Consolidation of manufacturers

C lid ti f N th A i Consolidation of North American Wholesalers/European OEM customers

Broadest product line with most effective distribution capabilities

Expanding footprint in high growth Growth in emerging markets

Expanding footprint in high growth Chinese and Eastern European markets

Renewable energy

Volatile commodity costs

Robust existing product offering

Manufacturing strategy/aggressive cost reductions/price increases

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cost reductions/price increases

Expanding installed base supports replacement business

119.6 124.5 128.2

U.S. Housing Stock (millions of units)

68.7

88.4102.3

1970 1980 1990 2000 2005 20071970 1980 1990 2000 2005 2007

Source: HUD

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We have been highly successful in promoting industry code de elopment and ed cationcode development and education

Consistently advocate development and enforcement of industry codes

Industry codes based on Watts product specifications create a significant growth opportunity and barrier to market entry

Approximately 66% of sales are derived Approximately 66% of sales are derived from code approved products

Efforts include thermostatic scald protection in the American Society of S it E i ASSE 1069/1070Sanitary Engineers ASSE 1069/1070

Subsequent adoption into national and state codes

Recently included in the Recommended Backflow Product List prepared by the Chinese National Backflow Standards Committee

U.S. Pex codes

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Watts has successfully acquired and integrated 48 companies since 1987companies since 1987

Acquisition strategyDisciplined acquisition criteria

Business logic

“Water by Watts”

Proprietary brand namesNew Technologies

Geographic Expansion

Proprietary brand names

Entry into new markets

Product line expansionCore water

Product AdjacenciesHunter

Technologies(2002)

H.F. Scientific

(2005)Changsha

Financial

Accretive to EPS Year 1

CFROI in mid-teens Year 1

products

Premier WaterSystems (2001)

Flowmatic(2004)Dormont

(2005)

Changsha Valve(2006)

CFROI in mid teens Year 1

EVA positive in Year 2+

Systems (2001)

ATS Expansion(2006)

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(2006)

BLÜCHER

Revenue 2007 $89M$ 9

Purchase Price - $170M

Accretion in year 2 $0 20 / shareAccretion in year 2 - $0.20 / share

Blucher offers the broadest range of stainless steel drainage systems in Europe

New platform for Watts in Europe

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BLÜCHER

Growth Strategy

Geographic expansion

New products

Leverage specification opportunitiesopportunities

Fragmented market

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BLÜCHER

M k t S dMarkets Served

Housing 25%

Commercial 25%

Marine 20%

Industrial 30%

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Our diversified business model

Geography

Chi 3%

Products

Based on 2008 Sales

China 3%

Specialty Plumbing &

Heating

DIY

Water Quality 54%54%

17%17%

13%13%Europe37%37%

5%5%

Canada

U.S.A.General Plumbing

Quality 54%54%

16%16%55%55%

CustomerDistribution channel

22%22% Wholesale

OEM

20%20%

Top 10

65%65%13%13%

W olesale

DIY

20%20%

80%80%Other

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Watts has an enviable track record of consistent revenue growth

$1 231

$1,382$1,459Fiscal year; $ millions

$1,231

$924

$825

$702$616

$549$549$516$522

$478$445 (1)$450$414$373

1995 1996 1997 1998 1999 1999.5 2000 2001 2002 2003 2004 2005 2006 2007 2008

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1 Includes impact of two divestitures completed in 1997

Note: 1997-1999 shown of fiscal year ending June 30; 1999.5 represents an annualized 1st half 1999 for illustrative purposes; 2000-2008 as calendar year basis

Sales

Financial ResultsIncome from Continuing Operations

(in millions) (Excluding restructuring and goodwill impairment)(in millions)

$83

$1,231

$1,382$1,459

$76

$65

2006 2007 2008 2006 2007 2008

Income from Continuing Operations(GAAP)

(in millions)

$77 $78

$47

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2006 2007 2008

Capital Structure

12/31/08 12/31/07

Cash $165 6 $290 3Cash $165.6 $290.3

Revolving Line of Credit 55.0 81.8

Other Long Term Debt 359 3 351 7Other Long Term Debt 359.3 351.7

Equity 842.4 915.5

Net Debt to Capitalization 22.8% 13.5%

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Cash Flow

12/31/08 12/31/07

Cash from Operations $146.4 $91.7

Net Capital Expenditures (25.5) (37.2)

Free Cash Flow $120.9 $54.5

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Why invest in Watts?

Pure-play opportunity in attractive water market

Conservative capital structure

Well positioned to benefit from:

Water market stabilityEmerging marketsRenewable energy

Strong track record of delivering growth

Stable, diversified business

Leader in industry

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consolidation

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