FEATUREDMINING
Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust continuing demand drove strong natural orders development: 1% on a reported
basis, 6% organically
• Revenue of $1.four billion, up 1% on a reported basis, up 6% organically
• Earnings per share of $0.62, adjusted earnings per share of $0.sixty six
• Adjusted EBITDA margin exceeded guidance by a hundred and sixty foundation points
• Raising full-year organic income 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 quantity one world water know-how
firm dedicated to solving the world’s most difficult water points, today reported second quarter
revenue of $1.4 billion, surpassing earlier guidance in each enterprise phase. Strong continued
world demand drove orders and backlog development throughout the portfolio.
Second quarter adjusted earnings earlier than interest, tax, depreciation and amortization (EBITDA) margin
was 16.6 %, better than the Company’s previous steerage and reflecting a year-over-year
lower of 70 basis factors. Inflation and the impression of constant chip shortages drove the margin
decline, exceeding the benefits of value realization and productiveness savings. Xylem generated web
earnings 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 influence of restructuring, realignment and particular expenses.
“ เพรสเชอร์เกจ delivered very strong second quarter performance on all key metrics, and well forward of our
steering for the quarter,” said Patrick Decker, Xylem president and CEO. “The outcome displays our
commercial momentum on persevering with underlying demand, disciplined operational execution, and a
average easing in chip supply constraints.”
“On the energy of sturdy backlog and orders growth, and the team’s demonstrated success mitigating
the consequences of inflation, we’re elevating our full-year steerage on income and earnings. This further
reinforces our longer-term development and worth creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 organic income progress to be within the vary of 8 to 10 %, and 3
to five p.c on a reported foundation. This represents a rise from the Company’s earlier full-year
organic revenue steerage of 4 to six %, and 1 to three percent on a reported foundation. Full-year 2022
adjusted EBITDA margin is now anticipated to be in the range of sixteen.5 to 17.0 p.c, raising the low end
of the earlier vary of sixteen.0 to 17.zero p.c. This results in adjusted earnings per share of $2.50 to
$2.70, elevating the low end from the previous range of $2.40 to $2.70. The elevated steering displays
strong demand, gradual easing of supply chain constraints and worth realization partially offset by
inflation and overseas exchange 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 guidance solely on a non-GAAP
basis because of the inherent problem in forecasting certain amounts that may be included in GAAP
earnings, similar to discrete tax objects, with out 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 increase
organically compared with second quarter 2021. This robust growth was driven by sturdy worth
realization, industrial dewatering demand, and wholesome activity in our wastewater utility business
in the U.S. and Western Europe.
• Second quarter adjusted EBITDA margin was 21.four %, up 240 basis factors from the prior
year. Reported operating income for the phase was $108 million. Adjusted operating earnings
for the section, which excludes $3 million of restructuring and realignment, was $111 million, a
14.4 p.c increase versus the comparable period last year. Reported operating margin for
the segment was 18.3 p.c, up 200 foundation points versus the prior year, and adjusted
working margin was 18.8 percent, up one hundred eighty basis factors versus the prior year. Strong worth
realization, quantity, and productivity savings greater than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water section consists of its portfolio of businesses in industrial, commercial constructing,
and residential purposes.
• Second quarter 2022 Applied Water revenue was $429 million, a 7.zero % enhance
organically year-over-year. The segment delivered strong price realization and backlog
execution in industrial and residential finish markets, partially offset by continued supply chain
constraints in industrial buildings within the United States.
• Second quarter adjusted EBITDA margin was sixteen.1 %, down a hundred thirty basis points from the
prior year. Reported working earnings 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
percent lower versus the comparable period last year. The phase reported operating
margin was 14.2 p.c, down a hundred thirty foundation points versus the prior 12 months interval. Adjusted
working margin declined one hundred twenty foundation points to 14.7 percent. Strong value realization and
productivity savings had 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 smart
metering, network technologies, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions revenue was $346 million, down 2.0
p.c organically versus the prior year. While chip provide stays constrained, the result is
better than our expectations due to improved chip provide within the quarter, and power in our
water quality test purposes.
• Second quarter adjusted EBITDA margin was 9.8 %, down 410 foundation points from the prior
12 months. Reported operating earnings for the phase was $(5) million, and adjusted working
revenue, which excludes $3 million of restructuring and realignment prices and $1 million of
shortages, unfavorable combine and better inflation more than offset worth realization and
productivity savings.
Supplemental info on Xylem’s second quarter 2022 earnings and reconciliations for sure nonGAAP items is posted at www.xylem.com/investors.
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About Xylem
Xylem (XYL) is a quantity one international water know-how company committed to solving critical water and
infrastructure challenges with innovation. Our 17,000 diverse workers delivered revenue of $5.2
billion in 2021. We are creating a extra sustainable world by enabling our clients to optimize water
and useful resource management, and serving to communities in additional than a hundred and fifty international locations turn out to be watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press launch incorporates “forward-looking statements” inside 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 comparable expressions or their unfavorable, could, however aren’t essential to, identify
forward-looking statements. By their nature, forward-looking statements tackle unsure issues and
embody any statements that are not historical, corresponding to statements about our technique, monetary plans,
outlook, objectives, plans, intentions or objectives (including those related to our social, environmental and
different sustainability goals); or handle attainable or future outcomes of operations or financial efficiency,
including statements referring to orders, revenues, operating margins and earnings per share development.
Although we believe that the expectations mirrored in any of our forward-looking statements are
affordable, actual outcomes may differ materially from these projected or assumed in any of our forwardlooking statements. Our future financial situation and results of operations, in addition to any forwardlooking statements, are topic to change and to inherent dangers and uncertainties, a lot of that are
past our management. Additionally, many of these risks and uncertainties are, and should proceed to be,
amplified by impacts from the war between Russia and Ukraine, as properly as the ongoing coronavirus
(“COVID-19”) pandemic and associated macroeconomic situations (including inflation). Important factors
that might trigger our precise outcomes, performance and achievements, or trade outcomes to differ
materially from estimates or projections contained in or implied by our forward-looking statements
embrace, amongst others, the next: the impression of overall industry and basic financial conditions,
together with industrial, governmental, and private and non-private sector spending and the strength of the
residential and commercial real estate markets, on financial exercise and our operations; geopolitical
events, including the warfare between Russia and Ukraine, and regulatory, financial and other dangers
related to our international sales and operations, including with respect to domestic content
necessities applicable to tasks with governmental funding; continued uncertainty around the
ongoing COVID-19 pandemic’s magnitude, length and impacts on our business, operations, progress,
and financial condition; actual or potential other epidemics, pandemics or global well being crises;
availability, shortage or delays in receiving electronic parts (in specific, semiconductors), elements,
and uncooked materials from our supply chain; manufacturing and working cost increases as a outcome of
macroeconomic situations, together with inflation, supply chain shortages, logistics challenges, tight labor
markets, prevailing value adjustments, tariffs and different elements; demand for our products; disruption,
competition or pricing pressures in the markets we serve; cybersecurity incidents or other disruptions of
information technology techniques 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 management
and other numerous and key talent, as nicely as competitors for general expertise and labor; problem predicting
our financial results; defects, security, warranty and legal responsibility claims, and recollects with respect to merchandise;
availability, regulation or interference with radio spectrum used by certain of our merchandise; uncertainty
associated to restructuring and realignment actions and associated charges and financial savings; our capability to proceed
strategic investments for progress; our capacity to efficiently identify, execute and combine acquisitions;
volatility in served markets or impacts on business and operations as a end result of weather conditions, together with
the consequences of local weather change; fluctuations in foreign foreign money exchange charges; our capacity to borrow or
refinance our present indebtedness and uncertainty across the availability of liquidity sufficient to satisfy
our wants; threat of future impairments to goodwill and different intangible belongings; failure to adjust to, or
modifications in, legal guidelines or rules, including these pertaining to anti-corruption, information privateness and security,
export and import, competition, and the setting and local weather change; changes in our efficient tax
charges or tax expenses; authorized, governmental or regulatory claims, investigations or proceedings and
related contingent liabilities; and other components 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 regarding our environmental and different
sustainability plans and objectives usually are not a sign that these statements are essentially material 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 associated statements could additionally be based on standards
for measuring progress that are still growing, inside controls and processes that continue to evolve,
and assumptions which might be subject to change sooner or later. All forward-looking statements made herein
are primarily based on data presently out there to us as of the date of this press launch. We undertake no
obligation to publicly replace or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by regulation
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