Xylem Reports Second Quarter 2022 Results

Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
Robust continuing demand drove sturdy organic orders growth: 1% on a reported
foundation, 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 foundation points
• Raising full-year organic revenue steering 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. (NYSE: XYL), a leading world water know-how
company devoted to fixing the world’s most challenging water points, today reported second quarter
revenue of $1.4 billion, surpassing earlier guidance in each enterprise segment. Strong continued
world demand drove orders and backlog progress across the portfolio.
Second quarter adjusted earnings earlier than interest, tax, depreciation and amortization (EBITDA) margin
was sixteen.6 percent, higher than the Company’s previous guidance and reflecting a year-over-year
lower of 70 foundation factors. Inflation and the impression of continuing chip shortages drove the margin
decline, exceeding the benefits of price realization and productivity savings. Xylem generated net
earnings of $112 million, or $0.sixty two per share, and adjusted web earnings of $120 million, or $0.66 per share,
which excludes the influence of restructuring, realignment and special expenses.
“The staff delivered very robust second quarter efficiency on all key metrics, and nicely ahead of our
steerage for the quarter,” said Patrick Decker, Xylem president and CEO. “The result displays our
business momentum on continuing underlying demand, disciplined operational execution, and a
moderate easing in chip supply constraints.”
“On the strength of sturdy backlog and orders growth, and the team’s demonstrated success mitigating
the effects of inflation, we’re elevating our full-year guidance on income and earnings. This further
reinforces our longer-term growth and worth creation thesis for Xylem.”
Xylem now expects full-year 2022 organic revenue progress to be within the range of eight to 10 percent, and 3
to five percent on a reported foundation. This represents a rise from the Company’s earlier full-year
organic revenue guidance of four to 6 %, and 1 to 3 percent on a reported foundation. Full-year 2022
adjusted EBITDA margin is now expected to be within the range of sixteen.5 to 17.zero p.c, raising the low finish
of the earlier range of sixteen.zero to 17.zero percent. This ends in adjusted earnings per share of $2.50 to
$2.70, raising the low end from the previous range of $2.forty to $2.70. The increased guidance displays
strong demand, gradual easing of supply chain constraints and price realization partially offset by
inflation and foreign trade headwinds.
Further 2022 planning assumptions are included in Xylem’s second quarter 2022 earnings materials
posted at www.xylem.com/investors. Excluding revenue, Xylem offers steerage only on a non-GAAP
foundation as a end result of inherent problem in forecasting sure amounts that might be included in GAAP
earnings, such as discrete tax items, with out unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure segment consists of its portfolio of companies serving clean water
supply, wastewater transport and therapy, and dewatering.
• Second quarter 2022 Water Infrastructure revenue was $589 million, a 9.0 percent improve
organically compared with second quarter 2021. This sturdy progress was driven by robust price
realization, industrial dewatering demand, and wholesome exercise in our wastewater utility business
in the united states and Western Europe.
• Second quarter adjusted EBITDA margin was 21.4 p.c, up 240 basis points from the prior
yr. Reported working revenue for the section was $108 million. Adjusted working pressure gauge ไฮ ด รอ ลิ ค
for the segment, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four p.c enhance versus the comparable interval final 12 months. Reported working margin for
the segment was 18.three p.c, up 200 basis points versus the prior yr, and adjusted
operating margin was 18.8 percent, up a hundred and eighty foundation points versus the prior year. Strong price
realization, volume, and productivity financial savings more than offset inflation and strategic
Applied Water
Xylem’s Applied Water phase consists of its portfolio of companies in industrial, business constructing,
and residential functions.
• Second quarter 2022 Applied Water revenue was $429 million, a 7.0 percent enhance
organically year-over-year. The phase delivered robust worth realization and backlog
execution in industrial and residential finish markets, partially offset by continued supply chain
constraints in commercial buildings within the United States.
• Second quarter adjusted EBITDA margin was 16.1 percent, down 130 foundation points from the
prior 12 months. Reported operating earnings for the segment was $61 million and adjusted working
income, which excludes $2 million of restructuring and realignment prices, was $63 million, a four.5
percent lower versus the comparable interval last year. The section reported operating
margin was 14.2 percent, down one hundred thirty basis factors versus the prior 12 months period. Adjusted
working margin declined 120 foundation factors to 14.7 %. Strong worth realization and
productivity savings had been greater than offset by inflation and decrease volume.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions segment consists of its portfolio of companies in sensible
metering, community applied sciences, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions revenue was $346 million, down 2.0
percent organically versus the prior 12 months. While chip supply remains constrained, the result’s
better than our expectations due to improved chip supply within the quarter, and energy in our
water high quality test purposes.
• Second quarter adjusted EBITDA margin was 9.eight %, down 410 basis points from the prior
12 months. Reported operating revenue for the phase was $(5) million, and adjusted working
income, which excludes $3 million of restructuring and realignment costs and $1 million of
shortages, unfavorable combine and higher inflation greater than offset worth realization and
productiveness savings.
Supplemental information on Xylem’s second quarter 2022 earnings and reconciliations for sure nonGAAP objects is posted at www.xylem.com/investors.
About Xylem
Xylem (XYL) is a number one international water know-how company committed to solving important water and
infrastructure challenges with innovation. Our 17,000 diverse employees delivered income of $5.2
billion in 2021. We are making a more sustainable world by enabling our customers to optimize water
and resource administration, and serving to communities in additional than 150 countries turn into watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press launch contains “forward-looking statements” within 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 related expressions or their unfavorable, may, but aren’t necessary to, identify
forward-looking statements. By their nature, forward-looking statements handle uncertain matters and
embody any statements that aren’t historic, similar to statements about our strategy, financial plans,
outlook, goals, plans, intentions or targets (including these associated to our social, environmental and
different sustainability goals); or address attainable or future outcomes of operations or financial performance,
together with statements referring to orders, revenues, operating margins and earnings per share growth.
Although we believe that the expectations mirrored in any of our forward-looking statements are
cheap, actual outcomes might 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 topic to vary and to inherent risks and uncertainties, lots of which are
past our control. Additionally, many of these risks and uncertainties are, and will continue to be,
amplified by impacts from the warfare between Russia and Ukraine, as nicely as the continued coronavirus
(“COVID-19”) pandemic and related macroeconomic situations (including inflation). Important components
that could trigger our actual outcomes, efficiency and achievements, or business outcomes to differ
materially from estimates or projections contained in or implied by our forward-looking statements
include, amongst others, the next: the impression of overall business and general economic circumstances,
together with industrial, governmental, and public and private sector spending and the energy of the
residential and commercial real estate markets, on financial activity and our operations; geopolitical
occasions, including the war between Russia and Ukraine, and regulatory, financial and other risks
related to our international sales and operations, including with respect to domestic content material
necessities applicable to projects with governmental funding; continued uncertainty around the
ongoing COVID-19 pandemic’s magnitude, length and impacts on our business, operations, development,
and monetary 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 materials from our supply chain; manufacturing and operating cost will increase because of
macroeconomic situations, together with inflation, provide chain shortages, logistics challenges, tight labor
markets, prevailing value changes, tariffs and other factors; demand for our merchandise; disruption,
competitors or pricing pressures within the markets we serve; cybersecurity incidents or different disruptions of
info know-how systems on which we rely, or involving our products; disruptions in operations at
our facilities or that of third parties upon which we rely; capability to retain and attract senior management
and different diverse and key talent, in addition to competition for total talent and labor; problem predicting
our financial outcomes; defects, safety, warranty and legal responsibility claims, and recalls 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 costs and savings; our capacity to proceed
strategic investments for development; our ability to successfully establish, execute and combine acquisitions;
volatility in served markets or impacts on enterprise and operations because of climate conditions, together with
the effects of climate change; fluctuations in foreign foreign money trade rates; our ability to borrow or
refinance our existing indebtedness and uncertainty around the availability of liquidity enough to satisfy
our needs; threat of future impairments to goodwill and different intangible belongings; failure to adjust to, or
changes in, laws or rules, including those pertaining to anti-corruption, information privacy and security,
export and import, competition, and the surroundings and local weather change; adjustments in our efficient tax
charges or tax expenses; legal, governmental or regulatory claims, investigations or proceedings and
related contingent liabilities; and other components set forth beneath “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 different statements on this press release concerning our environmental and different
sustainability plans and goals usually are not a sign that these statements are necessarily materials to
traders 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 requirements
for measuring progress that are nonetheless growing, inside controls and processes that continue to evolve,
and assumptions which would possibly be topic to alter sooner or later. All forward-looking statements made herein
are based on data 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 because of new
info, future occasions or in any other case, besides as required by legislation

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