Xylem Reports Second Quarter 2022 Results

FEATUREDMINING
Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust continuing demand drove strong organic orders development: 1% on a reported
basis, 6% organically
• Revenue of $1.four billion, up 1% on a reported foundation, up 6% organically
• Earnings per share of $0.62, adjusted earnings per share of $0.66
• Adjusted EBITDA margin exceeded steering by one hundred sixty basis factors
• Raising full-year organic revenue guidance to a variety 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 global water know-how
firm dedicated to solving the world’s most difficult water issues, right now reported second quarter
income of $1.four billion, surpassing previous guidance in each business phase. Strong continued
world demand drove orders and backlog progress throughout the portfolio.
Second quarter adjusted earnings earlier than interest, tax, depreciation and amortization (EBITDA) margin
was 16.6 percent, better than the Company’s earlier steering and reflecting a year-over-year
lower of 70 basis points. Inflation and the impression of constant chip shortages drove the margin
decline, exceeding the advantages of value realization and productivity savings. Xylem generated web
earnings of $112 million, or $0.sixty two per share, and adjusted net earnings of $120 million, or $0.66 per share,
which excludes the impression of restructuring, realignment and particular costs.
“The team delivered very sturdy second quarter performance on all key metrics, and properly forward of our
steering for the quarter,” mentioned Patrick Decker, Xylem president and CEO. “The outcome reflects our
commercial momentum on persevering with underlying demand, disciplined operational execution, and a
average easing in chip provide constraints.”
“On the energy of strong backlog and orders progress, and the team’s demonstrated success mitigating
the effects of inflation, we are raising our full-year steerage on revenue and earnings. This additional
reinforces our longer-term development and value creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 organic revenue growth to be in the vary of 8 to 10 percent, and 3
to 5 % on a reported basis. This represents an increase from the Company’s previous full-year
natural income steering of four to 6 %, and 1 to 3 % on a reported basis. Full-year 2022
adjusted EBITDA margin is now expected to be in the range of 16.5 to 17.zero %, raising the low finish
of the previous vary of 16.zero to 17.0 percent. This results in adjusted earnings per share of $2.50 to
$2.70, elevating the low end from the earlier range of $2.forty to $2.70. The elevated steering reflects
sturdy demand, gradual easing of provide chain constraints and price 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 provides steering solely on a non-GAAP
foundation as a end result of inherent problem in forecasting sure amounts that may be included in GAAP
earnings, corresponding to discrete tax items, with out unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure phase consists of its portfolio of companies serving clean water
supply, wastewater transport and treatment, and dewatering.
• Second quarter 2022 Water Infrastructure revenue was $589 million, a 9.zero % enhance
organically in contrast with second quarter 2021. This robust development was driven by strong value
realization, industrial dewatering demand, and healthy exercise in our wastewater utility enterprise
in the us and Western Europe.
• Second quarter adjusted EBITDA margin was 21.four %, up 240 basis points from the prior
year. Reported working earnings for the phase was $108 million. Adjusted working earnings
for the section, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four p.c enhance versus the comparable period final 12 months. Reported operating margin for
the segment was 18.three %, up 200 foundation factors versus the prior year, and adjusted
operating margin was 18.8 percent, up one hundred eighty foundation points versus the prior yr. Strong worth
realization, volume, and productiveness savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water segment consists of its portfolio of companies in industrial, industrial building,
and residential applications.
• Second quarter 2022 Applied Water revenue was $429 million, a 7.0 % increase
organically year-over-year. The phase delivered strong worth realization and backlog
execution in industrial and residential finish markets, partially offset by continued supply chain
constraints in business buildings within the United States.
• Second quarter adjusted EBITDA margin was sixteen.1 %, down 130 basis points from the
prior 12 months. Reported operating earnings for the phase was $61 million and adjusted working
earnings, which excludes $2 million of restructuring and realignment prices, was $63 million, a four.5
p.c decrease versus the comparable interval last 12 months. The phase reported operating
margin was 14.2 percent, down 130 basis factors versus the prior 12 months period. Adjusted
operating margin declined a hundred and twenty foundation factors to 14.7 p.c. Strong worth realization and
productiveness savings have been more than offset by inflation and lower quantity.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions phase consists of its portfolio of companies in sensible
metering, community technologies, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions income was $346 million, down 2.zero
p.c organically versus the prior year. While chip supply remains constrained, the result is
higher than our expectations because of improved chip supply in the quarter, and power in our
water high quality check purposes.
• Second quarter adjusted EBITDA margin was 9.8 percent, down 410 foundation points from the prior
12 months. Reported operating income for the phase was $(5) million, and adjusted working
earnings, which excludes $3 million of restructuring and realignment costs and $1 million of
shortages, unfavorable mix and better inflation more than offset worth realization and
productivity financial savings.
Supplemental information on Xylem’s second quarter 2022 earnings and reconciliations for certain nonGAAP objects is posted at www.xylem.com/investors.
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About Xylem
Xylem (XYL) is a quantity one global water expertise firm committed to fixing important water and
infrastructure challenges with innovation. Our 17,000 diverse workers delivered income of $5.2
billion in 2021. เกจวัดแรงดันน้ำมันเครื่อง are making a more sustainable world by enabling our customers to optimize water
and useful resource administration, and serving to communities in additional than 150 international locations become watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press launch accommodates “forward-looking statements” within the that means 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 negative, might, however aren’t essential to, identify
forward-looking statements. By their nature, forward-looking statements handle uncertain matters and
embody any statements that aren’t historic, corresponding to statements about our strategy, monetary plans,
outlook, aims, plans, intentions or goals (including these related to our social, environmental and
other sustainability goals); or address potential or future results of operations or monetary efficiency,
together with statements regarding orders, revenues, operating margins and earnings per share progress.
Although we imagine that the expectations reflected in any of our forward-looking statements are
reasonable, precise outcomes might differ materially from these projected or assumed in any of our forwardlooking statements. Our future monetary condition and outcomes of operations, as nicely as any forwardlooking statements, are topic to vary and to inherent dangers and uncertainties, lots of which are
past our management. Additionally, many of those dangers and uncertainties are, and should continue to be,
amplified by impacts from the warfare between Russia and Ukraine, as well as the continuing coronavirus
(“COVID-19”) pandemic and related macroeconomic conditions (including inflation). Important factors
that would cause our actual results, performance and achievements, or industry results to differ
materially from estimates or projections contained in or implied by our forward-looking statements
embody, amongst others, the next: the influence of overall trade and basic economic circumstances,
together with industrial, governmental, and private and non-private sector spending and the strength of the
residential and industrial actual estate markets, on financial activity and our operations; geopolitical
occasions, together with the warfare between Russia and Ukraine, and regulatory, economic and different risks
related to our global gross sales and operations, including with respect to domestic content material
requirements applicable to tasks with governmental funding; continued uncertainty across the
ongoing COVID-19 pandemic’s magnitude, period and impacts on our enterprise, operations, progress,
and financial situation; actual or potential other epidemics, pandemics or world well being crises;
availability, scarcity or delays in receiving digital components (in particular, semiconductors), components,
and raw supplies from our supply chain; manufacturing and working price increases as a result of
macroeconomic circumstances, including inflation, provide chain shortages, logistics challenges, tight labor
markets, prevailing price changes, tariffs and other elements; demand for our products; disruption,
competitors or pricing pressures within the markets we serve; cybersecurity incidents or other disruptions of
data know-how systems on which we rely, or involving our merchandise; disruptions in operations at
our amenities or that of third parties upon which we rely; capacity to retain and appeal to senior administration
and other diverse and key expertise, in addition to competition for overall talent and labor; difficulty predicting
our monetary results; defects, security, warranty and legal responsibility claims, and recollects with respect to products;
availability, regulation or interference with radio spectrum utilized by sure of our merchandise; uncertainty
associated to restructuring and realignment actions and associated expenses and savings; our capacity to proceed
strategic investments for development; our capacity to successfully identify, execute and integrate acquisitions;
volatility in served markets or impacts on enterprise and operations as a outcome of weather circumstances, together with
the results of local weather change; fluctuations in international currency change rates; our capability to borrow or
refinance our present indebtedness and uncertainty around the availability of liquidity enough to satisfy
our wants; threat of future impairments to goodwill and other intangible belongings; failure to comply with, or
adjustments in, laws or laws, together with those pertaining to anti-corruption, data privacy and safety,
export and import, competition, and the surroundings and local weather change; changes in our effective tax
charges or tax bills; legal, governmental or regulatory claims, investigations or proceedings and
related contingent liabilities; and different components set forth under “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 in this press launch relating to our environmental and other
sustainability plans and objectives are not an indication that these statements are essentially materials to
investors or are required to be disclosed in our filings with the SEC. In addition, historic, current, and
forward-looking social, environmental and sustainability associated statements may be based on requirements
for measuring progress which would possibly be still growing, inner controls and processes that continue to evolve,
and assumptions which are topic to vary sooner or later. All forward-looking statements made herein
are based on info at present available to us as of the date of this press release. We undertake no
obligation to publicly update or revise any forward-looking statements, whether on account of new
info, future occasions or in any other case, besides as required by legislation
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