Xylem Reports Second Quarter 2022 Results

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Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust continuing demand drove robust organic orders development: 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 $0.66
• Adjusted EBITDA margin exceeded steering by a hundred and sixty basis points
• Raising full-year organic income guidance to a range of 8% to 10% from 4% to
6%, and adjusted EPS to a range of $2.50 to $2.70 from $2.40 to $2.70
Washington, D.C., August 2, 2022 – Xylem Inc. (NYSE: XYL), a leading world water expertise
company dedicated to solving the world’s most difficult water points, today reported second quarter
income of $1.4 billion, surpassing earlier steerage in every business segment. Strong continued
international demand drove orders and backlog development across the portfolio.
Second quarter adjusted earnings before curiosity, tax, depreciation and amortization (EBITDA) margin
was sixteen.6 p.c, better than the Company’s previous guidance and reflecting a year-over-year
decrease of 70 foundation points. Inflation and the impact of continuing chip shortages drove the margin
decline, exceeding the advantages of worth realization and productivity savings. Xylem generated web
earnings of $112 million, or $0.62 per share, and adjusted internet earnings of $120 million, or $0.66 per share,
which excludes the impression of restructuring, realignment and particular charges.
“The staff delivered very sturdy second quarter efficiency on all key metrics, and well ahead of our
steering for the quarter,” said Patrick Decker, Xylem president and CEO. “The end result displays our
industrial momentum on persevering with underlying demand, disciplined operational execution, and a
moderate easing in chip supply constraints.”
“On the power of robust backlog and orders progress, and the team’s demonstrated success mitigating
the effects of inflation, we are elevating our full-year steerage on income and earnings. This further
reinforces our longer-term progress and value creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 organic income growth to be within the vary of 8 to 10 percent, and 3
to 5 % on a reported foundation. This represents a rise from the Company’s previous full-year
natural income steering of four to 6 p.c, and 1 to 3 percent on a reported foundation. Full-year 2022
adjusted EBITDA margin is now anticipated to be in the vary of sixteen.5 to 17.zero p.c, elevating the low finish
of the earlier vary of sixteen.0 to 17.0 %. This ends in adjusted earnings per share of $2.50 to
$2.70, elevating the low finish from the earlier vary of $2.forty to $2.70. The elevated steerage displays
strong demand, gradual easing of provide chain constraints and worth realization partially offset by
inflation and foreign exchange headwinds.
Further 2022 planning assumptions are included in Xylem’s second quarter 2022 earnings supplies
posted at www.xylem.com/investors. Excluding revenue, Xylem offers steering solely on a non-GAAP
basis due to the inherent issue in forecasting certain quantities 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 section consists of its portfolio of businesses serving clean water
delivery, wastewater transport and therapy, and dewatering.
• Second quarter 2022 Water Infrastructure revenue was $589 million, a 9.0 % improve
organically compared with second quarter 2021. This strong growth was driven by strong price
realization, industrial dewatering demand, and wholesome exercise in our wastewater utility enterprise
in the U.S. and Western Europe.
pressure gauge หลักการ ทํา งาน adjusted EBITDA margin was 21.4 percent, up 240 foundation points from the prior
yr. Reported working income for the segment was $108 million. Adjusted working revenue
for the segment, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four p.c improve versus the comparable period final yr. Reported operating margin for
the section was 18.three percent, up 200 basis factors versus the prior yr, and adjusted
operating margin was 18.eight percent, up a hundred and eighty basis points versus the prior 12 months. Strong value
realization, quantity, and productivity savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water phase consists of its portfolio of companies in industrial, commercial constructing,
and residential functions.
• Second quarter 2022 Applied Water income was $429 million, a 7.0 p.c improve
organically year-over-year. The segment delivered sturdy worth 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 percent, down a hundred thirty foundation points from the
prior 12 months. Reported operating earnings for the section was $61 million and adjusted operating
earnings, which excludes $2 million of restructuring and realignment costs, was $63 million, a 4.5
percent decrease versus the comparable period last year. The segment reported working
margin was 14.2 p.c, down one hundred thirty foundation points versus the prior year interval. Adjusted
working margin declined 120 basis factors to 14.7 p.c. Strong value realization and
productivity financial savings have been greater than offset by inflation and decrease quantity.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions segment consists of its portfolio of businesses in sensible
metering, community technologies, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions income was $346 million, down 2.zero
% organically versus the prior 12 months. While chip supply remains constrained, the result is
higher than our expectations as a outcome of improved chip provide in the quarter, and strength in our
water high quality take a look at purposes.
• Second quarter adjusted EBITDA margin was 9.eight percent, down 410 foundation factors from the prior
12 months. Reported working revenue for the segment was $(5) million, and adjusted operating
revenue, which excludes $3 million of restructuring and realignment costs and $1 million of
shortages, unfavorable mix and higher inflation more than offset price realization and
productivity financial savings.
Supplemental information on Xylem’s second quarter 2022 earnings and reconciliations for sure nonGAAP gadgets is posted at www.xylem.com/investors.
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About Xylem
Xylem (XYL) is a leading global water expertise company dedicated to fixing crucial water and
infrastructure challenges with innovation. Our 17,000 diverse staff delivered revenue of $5.2
billion in 2021. We are making a extra sustainable world by enabling our clients to optimize water
and useful resource administration, and helping communities in more than one hundred fifty nations turn into watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press launch accommodates “forward-looking statements” within the which 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 related expressions or their negative, may, however usually are not necessary to, establish
forward-looking statements. By their nature, forward-looking statements address unsure matters and
embrace any statements that are not historic, corresponding to statements about our strategy, financial plans,
outlook, goals, plans, intentions or targets (including these related to our social, environmental and
other sustainability goals); or handle possible or future outcomes of operations or financial efficiency,
including statements relating to orders, revenues, working margins and earnings per share development.
Although we consider that the expectations mirrored in any of our forward-looking statements are
cheap, actual results may differ materially from those projected or assumed in any of our forwardlooking statements. Our future monetary condition and outcomes of operations, in addition to any forwardlooking statements, are topic to vary and to inherent dangers and uncertainties, lots of which are
beyond our control. Additionally, many of these risks and uncertainties are, and should proceed to be,
amplified by impacts from the war between Russia and Ukraine, as nicely as the continued coronavirus
(“COVID-19”) pandemic and associated macroeconomic situations (including inflation). Important components
that would cause our precise outcomes, efficiency and achievements, or industry results to differ
materially from estimates or projections contained in or implied by our forward-looking statements
include, amongst others, the next: the impact of total industry and basic financial conditions,
together with industrial, governmental, and public and private sector spending and the energy of the
residential and industrial real property markets, on economic activity and our operations; geopolitical
events, including the war between Russia and Ukraine, and regulatory, economic and other dangers
related to our world sales and operations, together with with respect to domestic content
necessities applicable to tasks with governmental funding; continued uncertainty across the
ongoing COVID-19 pandemic’s magnitude, duration and impacts on our enterprise, operations, progress,
and monetary condition; precise or potential other epidemics, pandemics or world health crises;
availability, scarcity or delays in receiving electronic elements (in explicit, semiconductors), components,
and raw materials from our supply chain; manufacturing and operating cost increases as a result of
macroeconomic situations, including inflation, provide chain shortages, logistics challenges, tight labor
markets, prevailing value adjustments, tariffs and other elements; demand for our merchandise; disruption,
competitors or pricing pressures in the markets we serve; cybersecurity incidents or different disruptions of
information technology methods on which we rely, or involving our products; disruptions in operations at
our services or that of third parties upon which we rely; ability to retain and appeal to senior management
and other numerous and key expertise, in addition to competitors for overall talent and labor; issue 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 merchandise; uncertainty
associated to restructuring and realignment actions and associated charges and financial savings; our ability to proceed
strategic investments for progress; our ability to successfully identify, execute and combine acquisitions;
volatility in served markets or impacts on enterprise and operations due to climate situations, including
the effects of climate change; fluctuations in international foreign money exchange rates; our ability to borrow or
refinance our current indebtedness and uncertainty across the availability of liquidity adequate to meet
our wants; danger of future impairments to goodwill and other intangible assets; failure to adjust to, or
changes in, laws or rules, including those pertaining to anti-corruption, data privateness and security,
export and import, competitors, and the surroundings and climate change; adjustments in our efficient tax
charges or tax expenses; authorized, governmental or regulatory claims, investigations or proceedings and
related contingent liabilities; and different factors set forth underneath “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 other statements on this press release concerning our environmental and different
sustainability plans and objectives are not an indication that these statements are necessarily materials to
investors or are required to be disclosed in our filings with the SEC. In addition, historical, current, and
forward-looking social, environmental and sustainability related statements could additionally be primarily based on standards
for measuring progress that are still creating, inner controls and processes that proceed to evolve,
and assumptions which are topic to vary in the future. All forward-looking statements made herein
are based on info at present obtainable to us as of the date of this press launch. We undertake no
obligation to publicly replace or revise any forward-looking statements, whether or not because of new
data, future occasions or in any other case, except as required by law
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