Ecolab Comments on Expected Impact of U.S. Tax Cuts and Jobs Act, Announces Intent to Contribute $25 Million to Ecolab Foundation, and Forecasts Double-Digit 4Q 2017 and Full Year 2018 Adjusted EPS Growth

January 23, 2018

2018 Adjusted EPS Expected to Rise 12% to 16% to
the $5.25-$5.45 Range

ST. PAUL, Minn.–(BUSINESS WIRE)–As a result of the passage of the U.S. Tax Cuts and Jobs Act and based
on currently available information, Ecolab expects to record a net
discrete tax benefit in the fourth quarter of 2017 of approximately
$0.45 to $0.55 per share. The net discrete tax benefit results from the
re-measurement of net U.S. deferred tax liabilities at a lower future
corporate tax rate, partially offset by tax expense from deemed
repatriated earnings of foreign subsidiaries. Beginning in 2018, Ecolab
expects the U.S. Tax Cuts and Jobs Act to benefit earnings by
approximately $0.10 per share.

In response to the passage of the new U.S. tax law, Ecolab announced its
intent to make a $25 million contribution to the Ecolab Foundation.
Since 1986, the Ecolab Foundation has contributed more than $100 million
to communities in which we do business by providing basic needs,
including hunger relief and affordable housing; supporting education,
the arts and environmental conservation; as well as providing support to
global relief organizations during times of natural disasters.

Ecolab also said that it expects to report improved sales momentum and
double-digit adjusted earnings growth in its fourth quarter ended Dec.
31, 2017, and for that momentum to continue and lead to strong growth
into 2018 with adjusted diluted earnings per share expected to rise 12%
to 16% to the $5.25 to $5.45 range.

Douglas M. Baker, Jr., Ecolab’s Chairman and Chief Executive Officer,
said, “We finished 2017 in a strong fashion, with better than forecasted
sales growth and double-digit adjusted earnings per share growth in the
fourth quarter. Sales rose 9%, with 6% fixed currency acquisition
adjusted growth, led by good volume gains and accelerating pricing. All
operating segments showed improving sales growth, with Energy recording
double-digit gains. We plan on again driving growth in 2018 using new
product introductions, superior sales and service execution, new account
wins, improved customer penetration and pricing. We will also continue
to focus on improved operating efficiency to leverage our top line gains
and yield margin improvement.

“With our business focused on helping our customers deliver on
fundamental global needs including clean water, safe food, abundant
energy and healthy environments, we believe we are very well-positioned
to deliver superior growth in 2018 and beyond. We will continue to
invest in our business to further build our product and service
capabilities as well as our business base so that we can better serve
our customers, and as a result, generate superior returns for our
shareholders. We remain excited by our opportunities and by our terrific
team.”

Business Outlook
2017
Taking
into account the significant net discrete tax benefit resulting from the
implementation of the U.S. Tax Cuts and Jobs Act described above, fourth
quarter reported diluted earnings per share are expected to be in the
$1.84 to $1.98 range, with full year 2017 reported diluted earnings per
share expected to be in the $5.05 to $5.19 range. As a result of the new
U.S. tax law and based on currently available information, Ecolab
expects to record a net discrete tax benefit in the fourth quarter of
2017 of approximately $0.45 to $0.55 per share. In addition to the net
discrete tax benefit described above, we expect additional special gains
and charges and other discrete tax items for the fourth quarter to be a
net benefit of $0.01 to $0.03 per share. Special gains and charges and
discrete tax items for the full year 2017 are expected to be a net
benefit in the $0.37 to $0.49 range. Ecolab’s reported diluted earnings
per share were $1.24 in the fourth quarter 2016 and were $4.14 for the
full year 2016.

Ecolab expects fourth quarter 2017 adjusted diluted earnings per share,
excluding special gains and charges and discrete tax items, to continue
to show sequential quarterly improvement, rising 10% to 12% to the $1.38
to $1.40 range. Full year 2017 adjusted diluted earnings per share is
expected to rise 7% to 8% to the $4.68 to $4.70 range. Ecolab’s adjusted
diluted earnings per share were $1.25 in the fourth quarter 2016 and
$4.37 for the full year 2016.

Ecolab expects to announce final 2017 results February 20, 2018.

2018
Ecolab looks for the improved sales and earnings
momentum to continue in 2018 with growth in all segments. The new US tax
law is expected to benefit the 2018 tax rate, with an expected adjusted
tax rate of approximately 22%, providing an approximate $0.10 benefit to
adjusted diluted earnings per share. Including the expected tax benefit,
Ecolab expects 2018 adjusted diluted earnings per share to rise
approximately 12% to 16% to the $5.25 to $5.45 range, excluding special
gains and charges and discrete tax items, with second half earnings
growth outpacing the first half, reflecting the expected impact of
higher delivered product costs and increased systems investments, both
of which are expected to have an outsized impact on the first half.
Reflecting these, first quarter 2018 adjusted diluted earnings per share
are expected to be in the $0.84 to $0.92 range and compare to $0.80
earned in the first quarter 2017.

We expect special charges in 2018 to be $0.12 to $0.15 per share
principally related to the contribution to the Ecolab Foundation as well
as integration of previously announced acquisitions and previously
announced restructuring plans. In addition, the discrete tax item
related to excess tax benefits on share-based compensation is expected
to be favorable. Other than this discrete tax item and special gains and
charges noted above, other such expected amounts are not currently
quantifiable.

We do not provide reconciliations for non-GAAP estimates on a
forward-looking basis (including those contained in this report) when we
are unable to provide a meaningful or accurate calculation or estimation
of reconciling items and the information is not available without
unreasonable effort. This is due to the inherent difficulty of
forecasting the timing and amount of various items that have not yet
occurred, are out of our control and/or cannot be reasonably predicted,
and that would impact reported earnings per share and the reported tax
rate, the most directly comparable forward-looking GAAP financial
measures to adjusted earnings per share and the adjusted tax rate. For
the same reasons, we are unable to address the probable significance of
the unavailable information.

About Ecolab
A trusted partner
at more than one million customer locations, Ecolab (ECL) is the global
leader in water, hygiene and energy technologies and services that
protect people and vital resources. With 2016 sales of $13 billion and
48,000 associates, Ecolab delivers comprehensive solutions and on-site
service to promote safe food, maintain clean environments, optimize
water and energy use and improve operational efficiencies for customers
in the food, healthcare, energy, hospitality and industrial markets in
more than 170 countries around the world. For more Ecolab news and
information, visit www.ecolab.com.

Cautionary Statements Regarding Forward-Looking
Information
This communication contains certain
statements relating to future events and our intentions, beliefs,
expectations and predictions for the future which are forward-looking
statements as that term is defined in the Private Securities Litigation
Reform Act of 1995. Words or phrases such as “will likely result,” “are
expected to,” “will continue,” “is anticipated,” “we believe,” “we
expect,” “estimate,” “project,” “may,” “will,” “intend,” “plan,”
“believe,” “target,” “forecast” (including the negative or variations
thereof) or similar terminology used in connection with any discussion
of future plans, actions or events generally identify forward-looking
statements. These forward-looking statements include, but are not
limited to, statements regarding our financial and business performance
and prospects, including forecasted 2017 fourth quarter and 2017 and
2018 full-year financial and business results, including sales growth,
reported and adjusted diluted earnings per share, delivered product
costs, new systems investments, special gains and charges and
quantifiable discrete tax items, adjusted tax rates and the impact of
the new US tax law. These statements are based on the current
expectations of management of the company. There are a number of risks
and uncertainties that could cause actual results to differ materially
from the forward-looking statements included in this communication. In
particular, the ultimate results of any restructuring, integration and
business improvement actions, including cost synergies, depend on a
number of factors, including the development of final plans, the impact
of local regulatory requirements regarding employee terminations, the
time necessary to develop and implement the restructuring and other
business improvement initiatives and the level of success achieved
through such actions in improving competitiveness, efficiency and
effectiveness.

Additional risks and uncertainties that may affect operating results and
business performance are set forth under Item 1A of our most recent Form
10-K and our other public filings with the Securities and Exchange
Commission (the "SEC") and include the vitality of the markets we serve,
including the impact of oil price fluctuations on the markets served by
our Global Energy segment; the impact of economic factors such as the
worldwide economy, capital flows, interest rates and foreign currency
risk, including reduced sales and earnings in other countries resulting
from the weakening of local currencies versus the U.S. dollar; our
ability to attract and retain high caliber management talent to lead our
business; our ability to execute key business initiatives, including
upgrades to our information technology systems; potential information
technology infrastructure failures and cybersecurity attacks; exposure
to global economic, political and legal risks related to our
international operations including with respect to our operations in
Russia; the costs and effects of complying with laws and regulations,
including those relating to the environment and to the manufacture,
storage, distribution, sale and use of our products; the occurrence of
litigation or claims, including related to the Deepwater Horizon oil
spill; our ability to develop competitive advantages through innovation;
difficulty in procuring raw materials or fluctuations in raw material
costs; our substantial indebtedness; our ability to acquire
complementary businesses and to effectively integrate such businesses;
restraints on pricing flexibility due to contractual obligations;
pressure on operations from consolidation of customers, vendors or
competitors; public health epidemics; potential losses arising from the
impairment of goodwill or other assets; potential loss of deferred tax
assets; changes in tax law and unanticipated tax liabilities; potential
chemical spill or release; potential class action lawsuits; the loss or
insolvency of a major customer or distributor; acts of war or terrorism;
natural or man-made disasters; water shortages; severe weather
conditions; and other uncertainties or risks reported from time to time
in our reports to the SEC. In light of these risks, uncertainties,
assumptions and factors, the forward-looking events discussed in this
communication may not occur. We caution that undue reliance should not
be placed on forward-looking statements, which speak only as of the date
made. Ecolab does not undertake, and expressly disclaims, any duty to
update any forward-looking statement whether as a result of new
information, future events or changes in expectations, except as
required by law.

Non-GAAP Financial Information
This
news release and certain of the accompanying tables include financial
measures that have not been calculated in accordance with accounting
principles generally accepted in the U.S. (“GAAP”), including adjusted
diluted earnings per share, acquisition adjusted fixed currency sales
and the adjusted tax rate.

We provide these measures as additional information regarding our
operating results. We use these non-GAAP measures internally to evaluate
our performance and in making financial and operational decisions,
including with respect to incentive compensation. We believe that our
presentation of these measures provides investors with greater
transparency with respect to our results of operations and that these
measures are useful for period-to-period comparison of results.

Our non-GAAP financial measures for diluted earnings per share and tax
rate exclude the impact of special (gains) and charges and the impact of
discrete tax items. We include items within special (gains) and charges
and discrete tax items that we believe can significantly affect the
period-over-period assessment of operating results and not necessarily
reflect costs associated with historical trends and future results.
After tax special (gains) and charges are derived by applying the
applicable local jurisdictional tax rate to the corresponding pre-tax
special (gains) and charges.

We evaluate the performance of our international operations based on
fixed currency rates of foreign exchange, which eliminate the
translation impact of exchange rate fluctuations on our international
results. Fixed currency amounts included in this release are based on
translation into U.S. dollars at the fixed foreign currency exchange
rates established by management at the beginning of 2017. We also
provide our segment results based on public currency rates for
informational purposes.

Acquisition adjusted growth rates exclude the results of any acquired
business from the first twelve months post acquisition and exclude the
results of divested businesses from the previous twelve months prior to
divestiture. Acquisition adjusted growth rates also exclude sales to our
Venezuelan deconsolidated subsidiaries from both the current period and
comparable period of the prior year.

These non-GAAP financial measures are not in accordance with, or an
alternative to, GAAP and may be different from non-GAAP measures used by
other companies. Investors should not rely on any single financial
measure when evaluating our business. We recommend that investors view
these measures in conjunction with the GAAP measures included in this
news release.

The table below provides a reconciliation of the percentage components
for acquisition adjusted fixed currency sales growth for the fourth
quarter ended December 31, 2017 over the fourth quarter ended December
31, 2016.