FEATUREDMINING
Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust persevering with demand drove robust natural orders growth: 1% on a reported
foundation, 6% organically
• Revenue of $1.four 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 160 foundation points
• Raising full-year natural income guidance to a spread of 8% to 10% from 4% to
6%, and adjusted EPS to a variety of $2.50 to $2.70 from $2.forty to $2.70
Washington, D.C., August 2, 2022 – Xylem Inc. ( pressure gauge วัด แรง ดัน น้ำ : XYL), a leading international water expertise
company devoted to fixing the world’s most challenging water issues, today reported second quarter
revenue of $1.4 billion, surpassing earlier guidance in every business section. Strong continued
world demand drove orders and backlog growth across the portfolio.
Second quarter adjusted earnings earlier than curiosity, tax, depreciation and amortization (EBITDA) margin
was 16.6 p.c, higher than the Company’s earlier guidance and reflecting a year-over-year
decrease of 70 foundation points. Inflation and the influence of continuing chip shortages drove the margin
decline, exceeding the advantages of value realization and productivity savings. Xylem generated internet
revenue of $112 million, or $0.sixty two per share, and adjusted internet earnings of $120 million, or $0.sixty six per share,
which excludes the impact of restructuring, realignment and particular charges.
“The group delivered very sturdy second quarter performance on all key metrics, and properly forward of our
steering for the quarter,” said Patrick Decker, Xylem president and CEO. “The end result displays our
commercial momentum on persevering with underlying demand, disciplined operational execution, and a
average easing in chip provide constraints.”
“On the power of robust backlog and orders progress, and the team’s demonstrated success mitigating
the consequences of inflation, we’re raising our full-year steerage on income and earnings. This additional
reinforces our longer-term growth and worth creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 organic revenue growth to be within the range of eight to 10 percent, and three
to five p.c on a reported basis. This represents an increase from the Company’s previous full-year
organic revenue steering of 4 to 6 %, and 1 to three percent on a reported basis. Full-year 2022
adjusted EBITDA margin is now anticipated to be within the range of sixteen.5 to 17.0 %, elevating the low finish
of the earlier vary of 16.zero to 17.zero percent. This ends in adjusted earnings per share of $2.50 to
$2.70, elevating the low end from the previous vary of $2.40 to $2.70. The elevated steering reflects
strong demand, gradual easing of provide chain constraints and value realization partially offset by
inflation and foreign change headwinds.
Further 2022 planning assumptions are included in Xylem’s second quarter 2022 earnings supplies
posted at www.xylem.com/investors. Excluding income, Xylem offers steering solely on a non-GAAP
basis due to the inherent difficulty in forecasting certain quantities that would be included in GAAP
earnings, such as discrete tax objects, without unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure phase consists of its portfolio of companies serving clear water
delivery, wastewater transport and treatment, and dewatering.
• Second quarter 2022 Water Infrastructure revenue was $589 million, a 9.0 p.c increase
organically in contrast with second quarter 2021. This strong progress was driven by strong worth
realization, industrial dewatering demand, and wholesome exercise in our wastewater utility enterprise
in the U.S. and Western Europe.
• Second quarter adjusted EBITDA margin was 21.four p.c, up 240 foundation points from the prior
year. Reported working earnings for the section was $108 million. Adjusted working earnings
for the phase, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four p.c enhance versus the comparable interval last year. Reported operating margin for
the segment was 18.3 p.c, up 200 basis factors versus the prior year, and adjusted
working margin was 18.8 %, up one hundred eighty foundation points versus the prior year. Strong value
realization, volume, and productiveness financial savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water phase consists of its portfolio of businesses in industrial, industrial constructing,
and residential purposes.
• Second quarter 2022 Applied Water revenue was $429 million, a 7.zero percent increase
organically year-over-year. The segment delivered sturdy worth realization and backlog
execution in industrial and residential end markets, partially offset by continued supply chain
constraints in industrial buildings within the United States.
• Second quarter adjusted EBITDA margin was 16.1 percent, down one hundred thirty foundation factors from the
prior 12 months. Reported operating revenue for the segment was $61 million and adjusted operating
income, which excludes $2 million of restructuring and realignment prices, was $63 million, a 4.5
p.c decrease versus the comparable interval last yr. The phase reported operating
margin was 14.2 percent, down one hundred thirty basis factors versus the prior 12 months period. Adjusted
operating margin declined a hundred and twenty foundation factors to 14.7 p.c. Strong price realization and
productiveness financial savings were greater than offset by inflation and decrease volume.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions section consists of its portfolio of companies in good
metering, community applied sciences, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions revenue was $346 million, down 2.0
% organically versus the prior year. While chip provide stays constrained, the result is
higher than our expectations as a end result of improved chip supply within the quarter, and energy in our
water high quality take a look at functions.
• Second quarter adjusted EBITDA margin was 9.eight percent, down 410 foundation factors from the prior
12 months. Reported working revenue for the phase was $(5) million, and adjusted working
income, which excludes $3 million of restructuring and realignment prices and $1 million of
shortages, unfavorable combine and higher inflation greater than offset worth realization and
productivity financial savings.
Supplemental information on Xylem’s second quarter 2022 earnings and reconciliations for sure nonGAAP objects is posted at www.xylem.com/investors.
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About Xylem
Xylem (XYL) is a leading world water technology company committed to fixing critical water and
infrastructure challenges with innovation. Our 17,000 various staff delivered revenue of $5.2
billion in 2021. We are creating a more sustainable world by enabling our customers to optimize water
and useful resource administration, and helping communities in more than one hundred fifty countries turn out to be watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press release incorporates “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, could, but usually are not essential to, determine
forward-looking statements. By their nature, forward-looking statements tackle unsure matters and
embrace any statements that are not historic, similar to statements about our strategy, monetary plans,
outlook, goals, plans, intentions or goals (including those associated to our social, environmental and
other sustainability goals); or handle attainable or future outcomes of operations or monetary efficiency,
together with statements relating to orders, revenues, working margins and earnings per share progress.
Although we believe 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 condition and results of operations, as properly as any forwardlooking statements, are subject to change and to inherent risks and uncertainties, lots of which are
past our control. Additionally, many of those risks and uncertainties are, and will continue to be,
amplified by impacts from the war between Russia and Ukraine, as properly as the continuing coronavirus
(“COVID-19”) pandemic and related macroeconomic conditions (including inflation). Important factors
that might cause our actual outcomes, performance and achievements, or business results to vary
materially from estimates or projections contained in or implied by our forward-looking statements
include, among others, the next: the impression of general trade and basic financial circumstances,
together with industrial, governmental, and private and non-private sector spending and the strength of the
residential and commercial real property markets, on financial activity and our operations; geopolitical
occasions, together with the war between Russia and Ukraine, and regulatory, financial and different risks
related to our world gross sales and operations, including with respect to domestic content material
requirements applicable to tasks with governmental funding; continued uncertainty around the
ongoing COVID-19 pandemic’s magnitude, length and impacts on our business, operations, development,
and financial condition; actual or potential different epidemics, pandemics or global health crises;
availability, scarcity or delays in receiving digital components (in particular, semiconductors), components,
and uncooked materials from our provide chain; manufacturing and operating value will increase as a result of
macroeconomic situations, together with inflation, supply chain shortages, logistics challenges, tight labor
markets, prevailing price changes, tariffs and other elements; demand for our products; disruption,
competitors or pricing pressures in the markets we serve; cybersecurity incidents or other disruptions of
info know-how methods on which we rely, or involving our merchandise; disruptions in operations at
our facilities or that of third parties upon which we rely; capacity to retain and attract senior management
and other various and key talent, as properly as competition for overall talent and labor; difficulty predicting
our monetary outcomes; defects, safety, guarantee and legal responsibility claims, and recalls with respect to merchandise;
availability, regulation or interference with radio spectrum utilized by certain of our products; uncertainty
associated to restructuring and realignment actions and related costs and savings; our capability to continue
strategic investments for growth; our capability to successfully determine, execute and integrate acquisitions;
volatility in served markets or impacts on business and operations due to climate circumstances, together with
the results of climate change; fluctuations in foreign forex exchange rates; our ability to borrow or
refinance our current indebtedness and uncertainty across the availability of liquidity sufficient to satisfy
our needs; danger of future impairments to goodwill and different intangible property; failure to adjust to, or
changes in, legal guidelines or laws, including those pertaining to anti-corruption, data privateness and security,
export and import, competition, and the surroundings and local weather change; adjustments in our efficient tax
rates or tax bills; legal, governmental or regulatory claims, investigations or proceedings and
related contingent liabilities; and different elements set forth beneath “Item 1A. Risk Factors” in our Annual
Report on Form 10-K for the yr ended December 31, 2021 and in subsequent filings we make with
the Securities and Exchange Commission (“SEC”).
Forward-looking and different statements in this press launch relating to our environmental and other
sustainability plans and targets usually are not a sign that these statements are necessarily material to
investors or are required to be disclosed in our filings with the SEC. In addition, historical, present, and
forward-looking social, environmental and sustainability related statements may be based on standards
for measuring progress that are still creating, internal controls and processes that proceed to evolve,
and assumptions which are topic to change in the future. All forward-looking statements made herein
are primarily based on information currently out there to us as of the date of this press launch. We undertake no
obligation to publicly update or revise any forward-looking statements, whether as a outcome of new
information, future events or in any other case, besides as required by regulation
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