* Q2 adj EPS $0.65 vs est $0.50
* Net sales $190.4 mln vs est $178.9 mln
* Sees adj Q3 oper profit to grow 15-20 pct
* Shares up 8 percent (Adds conference call details, analyst comments, updates share movement)
BANGALORE, Aug 2 (Reuters) - Franklin Electric Co Inc's (FELE.O) quarterly results beat market estimates on strong growth at its water systems segment and the water-and-fuel-pumps maker said it expects higher consolidated operating income for the third quarter, sending its shares up 8 percent.
The company said it expected third-quarter consolidated operating income, before items, to increase by 15 percent to 20 percent.
Franklin Electric expects water systems sales to grow at a mid-single digit pace in the third quarter if exchange rates remain at their recent levels.
The water business, which accounted for 84 percent of total sales, jumped 19 percent in the second quarter to $160.2 million.
"What could drive sales higher in the overall water business is really not the U.S.-Canada market but the developing regions which they sell into, which grew about 31 percent," analyst Ned Borland of Hudson Securities said.
Sales were particularly strong in the developing regions of Latin America, Asia-Pacific and southern Africa, which represent about 30 percent of water sales in the quarter, Chief Executive Scott Trumbull said on a conference call with analysts.
However, Franklin Electric said while it gained market share in the water business, overall industry shipments declined.
The company expects its fueling business to grow by 10 percent to 15 percent in the third quarter, driven by international sales and better comparisons.
The fueling systems business makes pumps and equipment mainly for use in submersible fueling system applications.
Starting in late 2007 through early 2009, the company had an opportunity driven by environmental regulations in California, which represented a significant portion of revenue for the fueling business, analyst Borland said, adding that it got played out in second quarter of last year.
The segment, which declined by about 2 percent in the second quarter, saw international sales growth of 29 percent. The sales were mainly hurt by the wind down of vapor control equipment purchases by gas station owners in California.
For the second quarter, Franklin Electric reported net income of $11 million, or 47 cents a share, compared with $5.8 million, or 25 cents a share, a year ago.
Excluding restructuring and legal charges, the company earned 65 cents a share,
Net sales rose about 15 percent to $190.4 million.
Analysts on average were expecting earnings of 50 cents a share on revenue of $178.9 million, according to Thomson Reuters I/B/E/S.
Shares of the Bluffton, Indiana-based company, which touched a high of $33.28, were trading up 8 percent at $33.17 Monday afternoon on Nasdaq. (Reporting by Megha Mandavia in Bangalore; Editing by Prem Udayabhanu, Unnikrishnan Nair)