zws-20260331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

_________________________________________________

FORM 10-Q


(Mark one)

☒						QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarter ended March 31, 2026


☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to


Commission File Number:			001-35475

_________________________________________________


ZURN ELKAY WATER SOLUTIONS CORPORATION
(Exact name of registrant as specified in its charter)


Delaware		20-5197013
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

511 W. Freshwater Way		53204
Milwaukee,	Wisconsin	(Zip Code)
(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: (855) 480-5050

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $.01 par value	ZWS	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by checkmark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.


Class						Outstanding at April 16, 2026
Zurn Elkay Water Solutions Corporation Common Stock, $0.01 par value per share						166,871,913 shares




Part I FINANCIAL INFORMATION

Item 1.	Financial Statements	4

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4.	Controls and Procedures	30

Part II OTHER INFORMATION

Item 1.	Legal Proceedings	31



Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31

Item 5.	Other Information	31

Item 6.	Exhibits	32

Signatures		33


	(Unaudited)
	March 31, 2026		December 31, 2025
Assets
Current assets:
Cash and cash equivalents	$	273.5	$	300.5
Receivables, net	242.7		184.8
Inventories, net	292.3		274.4
Income taxes receivable	1.8		13.3
Other current assets	26.2		38.7
Total current assets	836.5		811.7
Property, plant and equipment, net	155.9		157.6
Intangible assets, net	820.4		835.0
Goodwill	794.4		795.0

Other assets	77.2		80.1
Total assets	$	2,684.4	$	2,679.4
Liabilities and stockholders' equity
Current liabilities:
Current maturities of debt	$	1.4	$	0.9
Trade payables	99.0		65.2
Compensation and benefits	18.3		40.9
Current portion of pension and other postretirement benefit obligations	1.1		1.1
Other current liabilities	138.7		151.3
Total current liabilities	258.5		259.4

Long-term debt	497.6		495.6
Pension and other postretirement benefit obligations	9.5		9.6
Deferred income taxes	191.8		189.7
Operating lease liability	38.1		42.0

Other liabilities	82.1		79.8
Total liabilities	1,077.6		1,076.1

Stockholders' equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; shares issued and outstanding: 167,032,113 at March 31, 2026 and 166,981,602 at December 31, 2025	1.7		1.7

Additional paid-in capital	2,806.2		2,810.0
Retained deficit	(1,122.8)		(1,131.7)
Accumulated other comprehensive loss	(78.3)		(76.7)



Total stockholders' equity	1,606.8		1,603.3
Total liabilities and stockholders' equity	$	2,684.4	$	2,679.4


	Three Months Ended
	March 31, 2026		March 31, 2025
Net sales	$	433.0	$	388.8
Cost of sales	227.2		207.8
Gross profit	205.8		181.0
Selling, general and administrative expenses	108.2		101.2
Restructuring and other similar charges	0.9		1.7

Amortization of intangible assets	14.6		14.7
Income from operations	82.1		63.4
Non-operating expense:
Interest expense, net	(6.2)		(7.3)


Other income, net	1.0		—
Income before income taxes	76.9		56.1
Provision for income taxes	(18.0)		(15.1)

Net income from continuing operations	58.9		41.0
Income from discontinued operations, net of tax	—		2.6




Net income	$	58.9	$	43.6

Basic net income per share:
Continuing operations	$	0.35	$	0.24
Discontinued operations	$	—	$	0.02
Net income	$	0.35	$	0.26
Diluted net income per share:
Continuing operations	$	0.35	$	0.24
Discontinued operations	$	—	$	0.02
Net income	$	0.35	$	0.26
Weighted-average number of shares outstanding (in thousands):
Basic	167,696		170,346
Effect of dilutive equity awards	1,980		1,843
Diluted	169,676		172,189


	Employee termination benefits		Contract termination and other associated costs		Total
Accrued restructuring costs, December 31, 2025 (1)	$	1.6	$	0.3	$	1.9

Charges	0.1		0.8		0.9
Cash payments	(0.9)		(1.0)		(1.9)

Accrued restructuring costs, March 31, 2026 (1)	$	0.8	$	0.1	$	0.9


	Three Months Ended
Customer Type	March 31, 2026		March 31, 2025
Institutional	$	214.2	$	191.4
Commercial	126.6		108.9
All other	92.2		88.5
Total	$	433.0	$	388.8


	Three Months Ended
Geography	March 31, 2026		March 31, 2025
United States	$	398.6	$	357.5
Canada	23.2		20.1
Rest of world	11.2		11.2
Total	$	433.0	$	388.8


	Common stock (1)		Additional paid-in capital		Retained deficit		Accumulated other comprehensive loss		Total stockholders’ equity
Balance at December 31, 2024	$	1.7	$	2,828.2	$	(1,168.7)	$	(74.4)	$	1,586.8
Total comprehensive income	—		—		43.6		(0.2)		43.4
Stock-based compensation expense	—		10.5		—		—		10.5
Proceeds from exercise of stock options and ESPP contributions	—		1.1		—		—		1.1
Taxes withheld and paid on employees' share-based payment awards	—		(0.5)		—		—		(0.5)
Repurchase of common stock	—		—		(78.0)		—		(78.0)



Common stock dividends ($0.09 per share)	—		(15.3)		—		—		(15.3)

Balance at March 31, 2025	$	1.7	$	2,824.0	$	(1,203.1)	$	(74.6)	$	1,548.0


	Common stock (1)		Additional paid-in capital		Retained deficit		Accumulated other comprehensive loss		Total stockholders’ equity
Balance at December 31, 2025	$	1.7	$	2,810.0	$	(1,131.7)	$	(76.7)	$	1,603.3
Total comprehensive income	—		—		58.9		(1.6)		57.3
Stock-based compensation expense	—		11.7		—		—		11.7
Proceeds from exercise of stock options and ESPP contributions	—		2.5		—		—		2.5

Repurchase of common stock	—		—		(50.0)		—		(50.0)



Common stock dividends ($0.11 per share)	—		(18.0)		—		—		(18.0)

Balance at March 31, 2026	$	1.7	$	2,806.2	$	(1,122.8)	$	(78.3)	$	1,606.8


	Foreign Currency Translation and Other		Pension and Other Postretirement Plans		Total
Balance at December 31, 2025	$	(76.6)	$	(0.1)	$	(76.7)
Other comprehensive income before reclassifications	(1.6)		—		(1.6)

Net current period other comprehensive income (loss)	(1.6)		—		(1.6)
Balance at March 31, 2026	$	(78.2)	$	(0.1)	$	(78.3)


	March 31, 2026		December 31, 2025
Finished goods	$	253.3	$	241.3
Work in progress	20.6		17.3

Raw materials	51.8		49.2
Inventories at First-In, First-Out ("FIFO") cost	325.7		307.8
Adjustment to state inventories at Last-In, First-Out ("LIFO") cost	(33.4)		(33.4)
	$	292.3	$	274.4


		March 31, 2026
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	28.6	$	(23.3)	$	5.3
Customer relationships (including distribution network)	16 years	1,068.2		(461.3)		606.9
Tradenames	19 years	156.7		(34.8)		121.9
Intangible assets not subject to amortization - trademarks and tradenames		86.3		—		86.3
Total intangible assets, net	16 years	$	1,339.8	$	(519.4)	$	820.4

		December 31, 2025
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	28.4	$	(23.3)	$	5.1
Customer relationships (including distribution network)	16 years	1,068.6		(448.9)		619.7
Tradenames	19 years	156.7		(32.8)		123.9
Intangible assets not subject to amortization - trademarks and tradenames		86.3		—		86.3
Total intangible assets, net	16 years	$	1,340.0	$	(505.0)	$	835.0


	March 31, 2026		December 31, 2025
Commissions	$	11.0	$	9.1

Current portion of operating lease liability	15.1		14.7
Income taxes payable	6.3		3.1

Professional fees	5.0		5.8
Product warranty (1)	3.6		3.1
Restructuring and other similar charges (2)	0.9		1.9
Risk management (3)	5.1		5.8
Sales rebates	65.6		81.1
Tax indemnities	8.9		9.2
Taxes, other than income taxes	3.3		3.1
Other	13.9		14.4
	$	138.7	$	151.3


	Three Months Ended
	March 31, 2026		March 31, 2025
Balance at beginning of period	$	6.6	$	4.9

Charged to operations	2.4		0.9
Claims settled	(0.6)		(0.6)
Total	$	8.4	$	5.2
Less current reserve	$	3.6	$	5.2
Long-term reserve	$	4.8	$	—


Award Type	Number of Awards	Weighted Average Grant-Date Fair Value
Stock options	53,252	$	19.02
Restricted stock units	126,449	$	50.95
Performance stock units	282,084	$	51.73
Common stock	64,560	$	45.17


Net carrying amount as of December 31, 2025	$	795.0
Currency translation adjustments	(0.6)


Net carrying amount as of March 31, 2026	$	794.4


	March 31, 2026		December 31, 2025
Term loan (1)	$	476.8	$	476.4



Finance leases	22.2		20.1
Total	499.0		496.5
Less current maturities	1.4		0.9
Long-term debt	$	497.6	$	495.6


	Fair Value as of March 31, 2026
	Level 1		Level 2		Level 3		Total
Deferred compensation plan assets	$	3.7	$	15.8	$	—	$	19.5
Deferred compensation plan liabilities	23.5		—		—		23.5

	Fair Value as of December 31, 2025
	Level 1		Level 2		Level 3		Total
Deferred compensation plan assets	$	2.3	$	16.4	$	—	$	18.7
Deferred compensation plan liabilities	22.9		—		—		22.9

SEC Form 10-Q filed by Zurn Elkay Water Solutions Corporation