Bob Fishman
Chief Financial Officer at Pentair
Thank you, John, and good morning, everyone. Let's start on slide eight. With sales over $1 billion, we delivered another strong quarter of quality earnings. Return on sales or ROS expanded 90 basis points despite sales being down 1% versus last year's record Q1. Our core sales were down 1% year-over-year, driven primarily by growth in water solutions, which was more than offset by slight decline in Flow and Pool. Sales across all three segments increased sequentially from Q4. Pool sales in Q1 exceeded Q4 2023 sales which in turn exceeded Q3 2023 sales as we had guided to last October.
First quarter segment income increased 3% to $217 million and return on sales expanded 90 basis points year-over-year to 21.4%. These results were driven by favorable mix. Price more than offsetting inflation as well as transformation. ROS improved sequentially from Q4 and approached the Q2 2023 record of 21.6%. We delivered adjusted EPS of $0.94, which exceeded our guidance and was up 3% year-over-year. As John previously mentioned, we are excited to be entering what we believe to be a more normal operating environment for the first time in nearly four years.
Please turn to slide nine. Flow sales declined 2% year-over-year. Commercial sales growth of 9% and industrial sales growth of 2% were more than offset by a decline in residential sales of 12%. Our residential sales are more closely tied to the overall housing and agriculture market. Segment income grew 19% and return on sales expanded 350 basis points to 20.1% marking the first time ROS has reached or exceeded 20%. The strong margin expansion was a result of price and mix exceeding inflation and continued progress on our transformation initiatives.
Please turn to slide 10. In Q1 water solution sales were up slightly to $273 million driven by commercial sales up approximately 1% and residential sales down approximately 1%. Segment income grew 6% to $56 million, and return on sales expanded 110 basis points to 20.4%, driven primarily by favorable mix and transformation continuing to drive operational efficiencies. This is the eighth consecutive quarter of ROS expansion. Margins have nearly doubled, from 10.8% in Q1 2022 to 20.4% in Q1 2024. Within our residential business in water solutions we have continued to see improvement in our year-over-year sales rate for the last five quarters.
Within our commercial business in water solutions, both filtration and ice drove sales growth, which was offset by lower services revenue due to project life cycles. Please turn to slide eleven. In Q1 Pool sales declined 1% to $359 million. However, Q1 sales improved nearly 7% sequentially from Q4 2023, as expected. Segment income was $111 million down 5%, and return on sales decreased 110 basis points due to lower volume. An increase in costs as we prepared for the peak Pool season in Q2 and investment in transformation. We expect Pool margins to expand each quarter year-on-year for the remainder of 2024.
Please turn to slide 12. At our investor day in March, we updated our three year margin targets to reflect margin expansion through full year 2026, extending our plan by a year. With contributions from all four of our key transformation initiatives, pricing, sourcing, operations, and organization we are targeting ROS to expand by 540 basis points to 24% as compared to full year 2022 and have the opportunity to do even better as we discussed during our investor day. In full year 2023, we achieved ROS of 20.8% and expect to continue to drive margin expansion to approximately 22% by year-end.
Please turn to slide 13. This Runway provides context of when we expect each wave to deliver margin expansion in our reported results. Note that we expect our transformation benefits to compound with each additional wave and the entire process to begin to repeat in 2027, creating a continuous cycle of ongoing savings. Please turn to slide 14. In Q1, we used $127 million in cash, which is consistent with prior year quarter. Q1 is predominantly a cash use quarter and typically followed by strong cash generation in Q2, our seasonally highest quarter. Our net debt leverage ratio was 2.1 times, down from 2.6 times in Q1 a year ago.
Our ROIC was 14%. We continue to target high teens return on invested capital. We plan to remain disciplined with our capital and continue to focus on debt reduction amid the higher interest rate environment along with share repurchases to offset dilution. With the net debt leverage ratio within our target range, we have additional flexibility to strategically allocate additional capital to areas with the highest shareholder returns. Moving to slide 15. For the full year we are maintaining our adjusted EPS guidance range up[Phonetic] $4.15 to $4.25 which is up roughly 12% at the midpoint. Also for the full year, we continue to expect sales to be up approximately 2% to 3% with Flow sales to be up approximately low single digits, water solution sales to be approximately flat, and Pool sales to be approximately 7% for the full year.
We also expect segment income to increase 8% to 11%. For the second quarter, we expect sales to be up approximately 1% to 2% compared to last year's record Q2. We expect strong growth in Pool sales in Q2 somewhat offset by challenging compares in our water solutions segment. We expect second quarter segment income to increase 10% to 12% with significant ROS expansion. We are also introducing strong adjusted EPS guidance for the second quarter of approximately a $1.15 to $1.17, up roughly 13% at the midpoint. I would now like to turn the call over to the operator for Q&A after which John will have a few closing remarks. Operator, please open the line for questions. Thank you.
