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Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust continuing demand drove sturdy natural 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.sixty six
• Adjusted EBITDA margin exceeded steerage by 160 foundation factors
• Raising full-year natural revenue guidance to a spread of 8% to 10% from 4% to
6%, and adjusted EPS to a spread of $2.50 to $2.70 from $2.forty to $2.70
Washington, D.C., August 2, 2022 – Xylem Inc. (NYSE: XYL), a leading international water technology
firm devoted to fixing the world’s most difficult water issues, today reported second quarter
income of $1.four billion, surpassing previous guidance in every business section. Strong continued
world demand drove orders and backlog growth throughout the portfolio.
Second quarter adjusted earnings before curiosity, tax, depreciation and amortization (EBITDA) margin
was 16.6 p.c, better than the Company’s previous steerage and reflecting a year-over-year
decrease of 70 basis points. Inflation and the impression of constant chip shortages drove the margin
decline, exceeding the advantages of price realization and productiveness financial savings. Xylem generated net
revenue of $112 million, or $0.62 per share, and adjusted net earnings of $120 million, or $0.sixty six per share,
which excludes the impression of restructuring, realignment and special charges.
“The group delivered very robust second quarter efficiency on all key metrics, and nicely ahead of our
guidance for the quarter,” mentioned Patrick Decker, Xylem president and CEO. “The outcome displays our
business momentum on persevering with underlying demand, disciplined operational execution, and a
moderate easing in chip provide constraints.”
“On the strength of sturdy backlog and orders progress, and the team’s demonstrated success mitigating
the consequences 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 income development to be within the vary of eight to 10 p.c, and 3
to 5 % on a reported basis. This represents an increase from the Company’s previous full-year
organic income steering of 4 to six %, and 1 to three % on a reported basis. Full-year 2022
adjusted EBITDA margin is now expected to be within the vary of 16.5 to 17.zero %, raising the low finish
of the earlier range of 16.0 to 17.0 p.c. This results in adjusted earnings per share of $2.50 to
$2.70, raising the low finish from the earlier vary of $2.forty to $2.70. The increased guidance reflects
sturdy demand, gradual easing of provide 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 supplies
posted at www.xylem.com/investors. Excluding income, Xylem supplies steerage only on a non-GAAP
foundation because of the inherent problem in forecasting certain amounts that might be included in GAAP
earnings, corresponding to discrete tax objects, with out unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure phase consists of its portfolio of businesses serving clear water
delivery, wastewater transport and remedy, and dewatering.
• Second quarter 2022 Water Infrastructure income was $589 million, a 9.0 % enhance
organically compared with second quarter 2021. This robust development was driven by sturdy worth
realization, industrial dewatering demand, and healthy exercise in our wastewater utility business
in the U.S. and Western Europe.
• Second quarter adjusted EBITDA margin was 21.four %, up 240 foundation points from the prior
year. Reported operating earnings for the segment was $108 million. Adjusted operating income
for the phase, which excludes $3 million of restructuring and realignment, was $111 million, a
14.4 % improve versus the comparable period final 12 months. Reported working margin for
the section was 18.3 p.c, up 200 basis factors versus the prior 12 months, and adjusted
operating margin was 18.eight p.c, up a hundred and eighty basis points versus the prior 12 months. Strong price
realization, quantity, and productiveness savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water phase consists of its portfolio of companies in industrial, commercial building,
and residential purposes.
• Second quarter 2022 Applied Water income was $429 million, a 7.zero percent improve
organically year-over-year. The section delivered strong 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 sixteen.1 %, down one hundred thirty basis points from the
prior yr. Reported working income for the phase was $61 million and adjusted operating
income, which excludes $2 million of restructuring and realignment prices, was $63 million, a 4.5
p.c lower versus the comparable period final yr. The section reported working
margin was 14.2 %, down one hundred thirty foundation factors versus the prior year period. Adjusted
working margin declined 120 foundation points to 14.7 percent. Strong price realization and
productivity savings had been more than offset by inflation and decrease volume.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions section consists of its portfolio of companies in smart
metering, network applied sciences, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions income was $346 million, down 2.0
p.c organically versus the prior yr. While chip supply stays constrained, the result is
better than our expectations as a outcome of improved chip supply in the quarter, and energy in our
water high quality test purposes.
• Second quarter adjusted EBITDA margin was 9.eight %, down 410 foundation points from the prior
12 months. Reported working revenue for the section was $(5) million, and adjusted working
revenue, which excludes $3 million of restructuring and realignment costs and $1 million of
shortages, unfavorable mix and better inflation more than offset value realization and
productiveness financial savings.
Supplemental info 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 global water expertise firm dedicated to solving crucial water and
infrastructure challenges with innovation. Our 17,000 diverse staff delivered income of $5.2
billion in 2021. We are creating a more sustainable world by enabling our customers to optimize water
and resource management, and serving to communities in additional than a hundred and fifty nations turn out to be watersecure. Join เครื่องมือความดัน at www.xylem.com.
Forward-Looking Statements
This press release 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 comparable expressions or their adverse, may, however aren’t necessary to, identify
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embrace any statements that aren’t historical, similar to statements about our technique, financial plans,
outlook, objectives, plans, intentions or targets (including those associated to our social, environmental and
other sustainability goals); or tackle potential or future outcomes of operations or financial performance,
including statements referring to orders, revenues, operating margins and earnings per share development.
Although we imagine that the expectations mirrored in any of our forward-looking statements are
affordable, actual results may differ materially from those projected or assumed in any of our forwardlooking statements. Our future monetary situation and results of operations, as well as any forwardlooking statements, are topic to vary and to inherent risks and uncertainties, a lot of which are
beyond our management. Additionally, many of these risks and uncertainties are, and will continue to be,
amplified by impacts from the war between Russia and Ukraine, as well as the ongoing coronavirus
(“COVID-19”) pandemic and associated macroeconomic conditions (including inflation). Important factors
that might cause our actual outcomes, performance and achievements, or industry results to vary
materially from estimates or projections contained in or implied by our forward-looking statements
embody, amongst others, the following: the influence of overall trade and common financial circumstances,
including industrial, governmental, and public and private sector spending and the strength of the
residential and business actual property markets, on economic exercise and our operations; geopolitical
occasions, together with the struggle between Russia and Ukraine, and regulatory, financial and different risks
related to our world sales and operations, including with respect to domestic content material
necessities relevant to tasks with governmental funding; continued uncertainty around the
ongoing COVID-19 pandemic’s magnitude, length and impacts on our enterprise, operations, progress,
and financial condition; actual or potential other epidemics, pandemics or world health crises;
availability, shortage or delays in receiving electronic components (in explicit, semiconductors), parts,
and uncooked supplies from our provide chain; manufacturing and operating price will increase because of
macroeconomic circumstances, including inflation, supply chain shortages, logistics challenges, tight labor
markets, prevailing worth modifications, tariffs and different components; demand for our merchandise; disruption,
competitors or pricing pressures within the markets we serve; cybersecurity incidents or different disruptions of
data know-how systems on which we rely, or involving our products; disruptions in operations at
our facilities or that of third events upon which we rely; ability to retain and entice senior administration
and other various and key talent, in addition to competitors for general expertise and labor; difficulty predicting
our financial results; defects, security, warranty and liability claims, and recollects with respect to merchandise;
availability, regulation or interference with radio spectrum utilized by sure of our products; uncertainty
related to restructuring and realignment actions and associated expenses and savings; our ability to continue
strategic investments for development; our capability to efficiently determine, execute and integrate acquisitions;
volatility in served markets or impacts on business and operations because of climate circumstances, together with
the results of climate change; fluctuations in international foreign money trade rates; our capacity to borrow or
refinance our current indebtedness and uncertainty around the availability of liquidity adequate to fulfill
our needs; risk of future impairments to goodwill and other intangible property; failure to comply with, or
changes in, legal guidelines or regulations, together with these pertaining to anti-corruption, information privateness and security,
export and import, competitors, and the environment and climate change; modifications in our effective tax
rates or tax expenses; legal, governmental or regulatory claims, investigations or proceedings and
related contingent liabilities; and other 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 different statements on this press release relating to our environmental and other
sustainability plans and objectives aren’t 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, present, and
forward-looking social, environmental and sustainability related statements could also be based on requirements
for measuring progress which are nonetheless developing, internal controls and processes that continue to evolve,
and assumptions which may be topic to alter sooner or later. All forward-looking statements made herein
are primarily based on info presently 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 result of new
info, future events or in any other case, except as required by law
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