Xylem Reports Second Quarter 2022 Results

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Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust persevering with demand drove sturdy organic orders growth: 1% on a reported
foundation, 6% organically
• Revenue of $1.4 billion, up 1% on a reported basis, up 6% organically
• Earnings per share of $0.sixty two, adjusted earnings per share of $0.sixty six
• Adjusted EBITDA margin exceeded steerage by a hundred and sixty basis points
• Raising full-year organic income steerage to a range of 8% to 10% from 4% to
6%, and adjusted EPS to a range of $2.50 to $2.70 from $2.40 to $2.70
Washington, D.C., August 2, 2022 – Xylem Inc. (NYSE: XYL), a leading world water technology
firm dedicated to solving the world’s most difficult water points, at present reported second quarter
income of $1.4 billion, surpassing previous steerage in every business segment. Strong continued
international demand drove orders and backlog development throughout the portfolio.
Second quarter adjusted earnings earlier than curiosity, tax, depreciation and amortization (EBITDA) margin
was 16.6 %, better than the Company’s previous steering and reflecting a year-over-year
decrease of 70 basis factors. Inflation and the impression of continuous chip shortages drove the margin
decline, exceeding the advantages of price realization and productiveness financial savings. Xylem generated web
income of $112 million, or $0.62 per share, and adjusted internet revenue of $120 million, or $0.sixty six per share,
which excludes the impact of restructuring, realignment and particular costs.
“The staff delivered very sturdy second quarter efficiency on all key metrics, and nicely ahead of our
steering for the quarter,” mentioned Patrick Decker, Xylem president and CEO. “The outcome displays our
industrial momentum on persevering with underlying demand, disciplined operational execution, and a
reasonable easing in chip supply constraints.”
“On the power of strong backlog and orders development, and the team’s demonstrated success mitigating
the effects of inflation, we are raising our full-year steerage on revenue and earnings. This further
reinforces our longer-term progress and worth creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 organic income growth to be in the range of eight to 10 %, and three
to five percent on a reported basis. This represents an increase from the Company’s previous full-year
natural revenue steering of 4 to 6 p.c, and 1 to three p.c on a reported foundation. เกจวัดแรงดันpcp -year 2022
adjusted EBITDA margin is now anticipated to be within the range of 16.5 to 17.0 p.c, raising the low finish
of the earlier vary of sixteen.0 to 17.0 %. This leads to adjusted earnings per share of $2.50 to
$2.70, elevating the low finish from the previous vary of $2.forty to $2.70. The elevated steerage reflects
strong demand, gradual easing of supply chain constraints and worth realization partially offset by
inflation and international trade headwinds.
Further 2022 planning assumptions are included in Xylem’s second quarter 2022 earnings supplies
posted at www.xylem.com/investors. Excluding revenue, Xylem offers guidance only on a non-GAAP
basis due to the inherent difficulty in forecasting certain quantities that might be included in GAAP
earnings, corresponding to discrete tax objects, without unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure segment consists of its portfolio of companies serving clear water
supply, wastewater transport and treatment, and dewatering.
• Second quarter 2022 Water Infrastructure income was $589 million, a 9.zero percent improve
organically compared with second quarter 2021. This sturdy development was pushed by strong value
realization, industrial dewatering demand, and healthy activity in our wastewater utility business
in the united states and Western Europe.
• Second quarter adjusted EBITDA margin was 21.four percent, up 240 foundation points from the prior
year. Reported working income for the segment was $108 million. Adjusted working revenue
for the phase, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four percent enhance versus the comparable period final year. Reported working margin for
the segment was 18.three %, up 200 foundation points versus the prior yr, and adjusted
operating margin was 18.eight percent, up one hundred eighty foundation factors versus the prior yr. Strong value
realization, volume, and productivity financial savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water segment consists of its portfolio of companies in industrial, industrial constructing,
and residential applications.
• Second quarter 2022 Applied Water income was $429 million, a 7.zero percent improve
organically year-over-year. The phase delivered sturdy price realization and backlog
execution in industrial and residential finish markets, partially offset by continued supply chain
constraints in industrial buildings in the United States.
• Second quarter adjusted EBITDA margin was 16.1 %, down 130 foundation factors from the
prior 12 months. Reported operating earnings for the segment was $61 million and adjusted operating
revenue, which excludes $2 million of restructuring and realignment prices, was $63 million, a 4.5
% lower versus the comparable interval final year. The section reported operating
margin was 14.2 percent, down a hundred thirty foundation factors versus the prior yr interval. Adjusted
working margin declined a hundred and twenty foundation factors to 14.7 %. Strong value realization and
productivity financial savings had been greater than offset by inflation and lower volume.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions segment consists of its portfolio of companies in smart
metering, network technologies, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions revenue was $346 million, down 2.0
% organically versus the prior yr. While chip provide remains constrained, the result is
higher than our expectations due to improved chip supply in the quarter, and energy in our
water quality take a look at purposes.
• Second quarter adjusted EBITDA margin was 9.8 percent, down 410 basis factors from the prior
yr. Reported operating income for the section was $(5) million, and adjusted working
income, which excludes $3 million of restructuring and realignment costs and $1 million of
shortages, unfavorable mix and better inflation greater than offset worth realization and
productivity financial savings.
Supplemental information on Xylem’s second quarter 2022 earnings and reconciliations for certain nonGAAP gadgets is posted at www.xylem.com/investors.
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About Xylem
Xylem (XYL) is a number one world water know-how firm committed to solving important water and
infrastructure challenges with innovation. Our 17,000 various employees delivered revenue of $5.2
billion in 2021. We are making a more sustainable world by enabling our clients to optimize water
and useful resource management, and helping communities in additional than one hundred fifty nations turn out to be watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press launch incorporates “forward-looking statements” throughout the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Generally, the words “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,”
“contemplate,” “predict,” “forecast,” “likely,” “believe,” “target,” “will,” “could,” “would,” “should,”
“potential,” “may” and similar expressions or their unfavorable, may, but are not essential to, determine
forward-looking statements. By their nature, forward-looking statements tackle unsure issues and
embrace any statements that aren’t historic, similar to statements about our strategy, monetary plans,
outlook, aims, plans, intentions or targets (including these associated to our social, environmental and
other sustainability goals); or handle possible or future outcomes of operations or financial efficiency,
including statements regarding orders, revenues, operating margins and earnings per share growth.
Although we consider that the expectations mirrored in any of our forward-looking statements are
cheap, precise outcomes could differ materially from those projected or assumed in any of our forwardlooking statements. Our future financial situation and outcomes of operations, in addition to any forwardlooking statements, are subject to vary and to inherent risks and uncertainties, lots of which are
past our management. Additionally, many of these dangers and uncertainties are, and should continue to be,
amplified by impacts from the warfare between Russia and Ukraine, in addition to the continued coronavirus
(“COVID-19”) pandemic and associated macroeconomic circumstances (including inflation). Important elements
that would cause our precise results, performance and achievements, or industry results to differ
materially from estimates or projections contained in or implied by our forward-looking statements
embrace, among others, the following: the influence of overall trade and general economic conditions,
including industrial, governmental, and public and private sector spending and the strength of the
residential and business actual estate markets, on financial activity and our operations; geopolitical
events, including the struggle between Russia and Ukraine, and regulatory, economic and different risks
related to our world sales and operations, including with respect to domestic content
requirements relevant to initiatives with governmental funding; continued uncertainty across the
ongoing COVID-19 pandemic’s magnitude, duration and impacts on our business, operations, growth,
and financial situation; precise or potential other epidemics, pandemics or global health crises;
availability, scarcity or delays in receiving electronic elements (in explicit, semiconductors), components,
and raw supplies from our supply chain; manufacturing and operating price will increase due to
macroeconomic conditions, together with inflation, supply chain shortages, logistics challenges, tight labor
markets, prevailing price modifications, tariffs and different factors; demand for our merchandise; disruption,
competition or pricing pressures within the markets we serve; cybersecurity incidents or different disruptions of
information technology methods on which we rely, or involving our merchandise; disruptions in operations at
our services or that of third parties upon which we rely; ability to retain and appeal to senior administration
and other numerous and key expertise, in addition to competition for overall talent and labor; problem predicting
our monetary outcomes; defects, security, warranty and liability claims, and recollects with respect to products;
availability, regulation or interference with radio spectrum utilized by certain of our merchandise; uncertainty
related to restructuring and realignment actions and related expenses and financial savings; our capacity to continue
strategic investments for development; our capacity to efficiently identify, execute and integrate acquisitions;
volatility in served markets or impacts on business and operations due to climate conditions, together with
the effects of climate change; fluctuations in foreign foreign money exchange rates; our ability to borrow or
refinance our existing indebtedness and uncertainty across the availability of liquidity enough to meet
our wants; danger of future impairments to goodwill and different intangible assets; failure to adjust to, or
modifications in, laws or laws, including those pertaining to anti-corruption, knowledge privacy and security,
export and import, competitors, and the surroundings and climate change; changes in our efficient tax
charges or tax bills; authorized, governmental or regulatory claims, investigations or proceedings and
associated contingent liabilities; and other factors set forth underneath “Item 1A. Risk Factors” in our Annual
Report on Form 10-K for the 12 months ended December 31, 2021 and in subsequent filings we make with
the Securities and Exchange Commission (“SEC”).
Forward-looking and other statements on this press release concerning our environmental and other
sustainability plans and objectives aren’t an indication that these statements are necessarily material to
traders or are required to be disclosed in our filings with the SEC. In addition, historic, current, and
forward-looking social, environmental and sustainability related statements could additionally be based on requirements
for measuring progress that are still growing, inner controls and processes that proceed to evolve,
and assumptions that are topic to vary in the future. All forward-looking statements made herein
are based mostly on information at present available to us as of the date of this press release. We undertake no
obligation to publicly replace or revise any forward-looking statements, whether as a result of new
information, future occasions or in any other case, besides as required by law
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