Xylem Reports Second Quarter 2022 Results

Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
Robust continuing demand drove sturdy organic orders progress: 1% on a reported
foundation, 6% organically
• Revenue of $1.4 billion, up 1% on a reported foundation, up 6% organically
• Earnings per share of $0.sixty two, adjusted earnings per share of $0.66
• Adjusted EBITDA margin exceeded guidance by a hundred and sixty foundation points
• Raising full-year organic revenue guidance to a range 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 expertise
firm devoted to solving the world’s most challenging water issues, today reported second quarter
income of $1.four billion, surpassing previous steering in every business section. Strong continued
global demand drove orders and backlog development across the portfolio.
Second quarter adjusted earnings before curiosity, tax, depreciation and amortization (EBITDA) margin
was 16.6 %, higher than the Company’s earlier steering and reflecting a year-over-year
decrease of 70 basis points. Inflation and the impact of continuing chip shortages drove the margin
decline, exceeding the advantages of worth realization and productiveness financial savings. Xylem generated net
income of $112 million, or $0.sixty two per share, and adjusted internet revenue of $120 million, or $0.sixty six per share,
which excludes the impression of restructuring, realignment and special expenses.
“The group delivered very robust second quarter performance on all key metrics, and nicely ahead of our
steerage for the quarter,” mentioned Patrick Decker, Xylem president and CEO. “The end result displays our
business momentum on persevering with underlying demand, disciplined operational execution, and a
reasonable easing in chip provide constraints.”
“On the strength of strong backlog and orders growth, and the team’s demonstrated success mitigating
the consequences of inflation, we’re elevating our full-year steering on revenue and earnings. This additional
reinforces our longer-term growth and value creation thesis for Xylem.”
Xylem now expects full-year 2022 organic revenue growth to be in the range of 8 to 10 p.c, and three
to 5 p.c on a reported basis. This represents a rise from the Company’s previous full-year
organic revenue guidance of 4 to 6 p.c, and 1 to 3 p.c on a reported foundation. Full-year 2022
adjusted EBITDA margin is now anticipated to be in the vary of 16.5 to 17.0 %, raising the low end
of the previous vary of sixteen.0 to 17.0 %. This leads to adjusted earnings per share of $2.50 to
$2.70, elevating the low finish from the previous range of $2.40 to $2.70. The increased steerage displays
sturdy demand, gradual easing of supply chain constraints and value 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 Excluding revenue, Xylem provides steering only on a non-GAAP
basis due to the inherent problem in forecasting certain quantities that would be included in GAAP
earnings, similar to discrete tax gadgets, with out unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure segment consists of its portfolio of businesses serving clean water
delivery, wastewater transport and remedy, and dewatering.
• Second quarter 2022 Water Infrastructure income was $589 million, a % increase
organically in contrast with second quarter 2021. This sturdy progress was pushed by strong worth
realization, industrial dewatering demand, and wholesome activity in our wastewater utility enterprise
in the us and Western Europe.
• Second quarter adjusted EBITDA margin was 21.4 %, up 240 foundation factors from the prior
year. Reported working earnings for the phase was $108 million. Adjusted working revenue
for the section, which excludes $3 million of restructuring and realignment, was $111 million, a
14.4 percent enhance versus the comparable interval last yr. Reported working margin for
the phase was 18.three p.c, up 200 basis factors versus the prior 12 months, and adjusted
working margin was 18.8 p.c, up a hundred and eighty foundation points versus the prior year. Strong value
realization, quantity, and productiveness savings greater than offset inflation and strategic
Applied Water
Xylem’s Applied Water phase consists of its portfolio of companies in industrial, industrial building,
and residential functions.
• Second quarter 2022 Applied Water revenue was $429 million, a 7.0 percent improve
organically year-over-year. The segment delivered robust value realization and backlog
execution in industrial and residential end markets, partially offset by continued supply chain
constraints in business buildings within the United States.
เกจวัดแรงดันน้ำมันเครื่อง adjusted EBITDA margin was sixteen.1 percent, down one hundred thirty foundation factors from the
prior year. Reported operating income for the phase was $61 million and adjusted working
earnings, which excludes $2 million of restructuring and realignment costs, was $63 million, a 4.5
% lower versus the comparable period last year. The section reported operating
margin was 14.2 p.c, down 130 foundation points versus the prior 12 months period. Adjusted
working margin declined a hundred and twenty foundation factors to 14.7 percent. Strong price realization and
productivity savings were greater than offset by inflation and lower quantity.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions section consists of its portfolio of companies in sensible
metering, network technologies, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions income was $346 million, down
p.c organically versus the prior 12 months. While chip supply stays constrained, the result’s
higher than our expectations as a result of improved chip supply in the quarter, and strength in our
water quality test functions.
• Second quarter adjusted EBITDA margin was 9.8 %, down 410 basis factors from the prior
yr. Reported working income for the section 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
productiveness financial savings.
Supplemental information on Xylem’s second quarter 2022 earnings and reconciliations for certain nonGAAP objects is posted at
About Xylem
Xylem (XYL) is a quantity one global water know-how firm committed to solving important water and
infrastructure challenges with innovation. Our 17,000 various staff delivered income of $5.2
billion in 2021. We are making a more sustainable world by enabling our clients to optimize water
and resource management, and serving to communities in more than a hundred and fifty countries turn out to be watersecure. Join us at
Forward-Looking Statements
This press release accommodates “forward-looking statements” throughout 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,”
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outlook, goals, plans, intentions or objectives (including these associated to our social, environmental and
other sustainability goals); or address attainable or future results of operations or financial efficiency,
together with statements referring to orders, revenues, operating margins and earnings per share development.
Although we consider that the expectations reflected in any of our forward-looking statements are
affordable, precise results could differ materially from these projected or assumed in any of our forwardlooking statements. Our future monetary situation and outcomes of operations, in addition to any forwardlooking statements, are topic to vary and to inherent risks and uncertainties, a lot of which are
beyond our control. Additionally, many of those risks and uncertainties are, and may proceed to be,
amplified by impacts from the warfare between Russia and Ukraine, in addition to the ongoing coronavirus
(“COVID-19”) pandemic and related macroeconomic conditions (including inflation). Important components
that would cause our actual results, performance and achievements, or business results to vary
materially from estimates or projections contained in or implied by our forward-looking statements
embrace, among others, the following: the influence of general trade and general economic conditions,
including industrial, governmental, and public and private sector spending and the energy of the
residential and commercial real estate markets, on economic activity and our operations; geopolitical
occasions, including the struggle between Russia and Ukraine, and regulatory, economic and different dangers
associated with our global gross sales and operations, together with with respect to home content material
necessities relevant to initiatives with governmental funding; continued uncertainty around the
ongoing COVID-19 pandemic’s magnitude, length and impacts on our business, operations, growth,
and monetary condition; precise or potential different epidemics, pandemics or world health crises;
availability, scarcity or delays in receiving electronic parts (in specific, semiconductors), components,
and uncooked materials from our provide chain; manufacturing and working cost will increase because of
macroeconomic situations, including inflation, provide chain shortages, logistics challenges, tight labor
markets, prevailing worth modifications, tariffs and different factors; demand for our merchandise; disruption,
competition or pricing pressures within the markets we serve; cybersecurity incidents or other disruptions of
data know-how methods on which we rely, or involving our products; disruptions in operations at
our services or that of third parties upon which we rely; capability to retain and appeal to senior management
and different numerous and key talent, in addition to competition for total talent and labor; issue predicting
our financial results; defects, security, 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 related costs and savings; our ability to continue
strategic investments for progress; our capability to efficiently identify, execute and integrate acquisitions;
volatility in served markets or impacts on business and operations because of weather circumstances, together with
the consequences of local weather change; fluctuations in overseas foreign money change rates; our capability to borrow or
refinance our current indebtedness and uncertainty across the availability of liquidity sufficient to fulfill
our needs; danger of future impairments to goodwill and other intangible belongings; failure to comply with, or
adjustments in, laws or rules, together with these pertaining to anti-corruption, data privateness and safety,
export and import, competitors, and the surroundings and local weather change; modifications in our efficient tax
rates or tax bills; legal, governmental or regulatory claims, investigations or proceedings and
associated contingent liabilities; and different elements 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”).
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sustainability plans and targets usually are not an indication 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 also be based on requirements
for measuring progress which would possibly be nonetheless developing, internal controls and processes that continue to evolve,
and assumptions that are topic to vary in the future. All forward-looking statements made herein
are based on information presently out there to us as of the date of this press launch. We undertake no
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data, future events or in any other case, except as required by law