Xylem Reports Second Quarter 2022 Results

FEATUREDMINING
Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust persevering with demand drove robust 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.sixty two, adjusted earnings per share of $0.sixty six
• Adjusted EBITDA margin exceeded guidance by 160 foundation factors
• 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 global water technology
firm devoted to fixing the world’s most difficult water issues, today reported second quarter
revenue of $1.4 billion, surpassing earlier steerage in every business section. 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 percent, higher than the Company’s earlier guidance and reflecting a year-over-year
lower of 70 foundation factors. Inflation and the influence of continuing chip shortages drove the margin
decline, exceeding the advantages of value realization and productiveness financial savings. Xylem generated net
earnings of $112 million, or $0.62 per share, and adjusted net earnings of $120 million, or $0.sixty six per share,
which excludes the impact of restructuring, realignment and special charges.
“The staff delivered very sturdy second quarter efficiency on all key metrics, and well ahead of our
guidance for the quarter,” mentioned Patrick Decker, Xylem president and CEO. “The result reflects our
business momentum on persevering with underlying demand, disciplined operational execution, and a
moderate easing in chip provide constraints.”
“On the strength of robust backlog and orders progress, and the team’s demonstrated success mitigating
the consequences of inflation, we’re elevating our full-year guidance on revenue and earnings. This additional
reinforces our longer-term growth and value creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 natural income progress to be within the range of 8 to 10 p.c, and three
to 5 % on a reported basis. This represents an increase from the Company’s previous full-year
organic income steerage of four to six %, and 1 to three p.c on a reported basis. Full-year 2022
adjusted EBITDA margin is now anticipated to be in the vary of 16.5 to 17.zero p.c, elevating the low end
of the earlier range of sixteen.0 to 17.0 %. This leads to adjusted earnings per share of $2.50 to
$2.70, raising the low finish from the previous vary of $2.40 to $2.70. The elevated steerage reflects
robust demand, gradual easing of provide chain constraints and worth realization partially offset by
inflation and overseas change headwinds.
Further 2022 planning assumptions are included in Xylem’s second quarter 2022 earnings supplies
posted at www.xylem.com/investors. Excluding revenue, Xylem supplies guidance only on a non-GAAP
basis as a result of inherent issue in forecasting sure quantities that may be included in GAAP
earnings, such as discrete tax objects, with out unreasonable effort.
Second Quarter Segment Results
Water Infrastructure
Xylem’s Water Infrastructure section 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.zero percent enhance
organically compared with second quarter 2021. This strong development was driven by strong 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 21.4 p.c, up 240 foundation points from the prior
12 months. Reported working income for the section was $108 million. Adjusted operating income
for the segment, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four % enhance versus the comparable interval last year. Reported operating margin for
the segment was 18.3 %, up 200 foundation factors versus the prior 12 months, and adjusted
operating margin was 18.8 %, up a hundred and eighty basis points versus the prior yr. Strong price
realization, volume, and productivity savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water section consists of its portfolio of businesses in industrial, industrial building,
and residential applications.
• Second quarter 2022 Applied Water income was $429 million, a 7.zero percent enhance
organically year-over-year. The phase delivered sturdy value realization and backlog
execution in industrial and residential end markets, partially offset by continued provide chain
constraints in commercial buildings within the United States.
• Second quarter adjusted EBITDA margin was 16.1 percent, down a hundred thirty basis factors from the
prior yr. Reported operating earnings for the phase was $61 million and adjusted working
income, which excludes $2 million of restructuring and realignment prices, was $63 million, a 4.5
p.c decrease versus the comparable period final year. เกจวัดแรงดันลมขนาดเล็ก reported operating
margin was 14.2 percent, down a hundred thirty foundation points versus the prior yr interval. Adjusted
operating margin declined one hundred twenty foundation factors to 14.7 percent. Strong worth realization and
productivity financial savings had been greater than offset by inflation and decrease quantity.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions phase consists of its portfolio of businesses in smart
metering, network applied sciences, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions revenue was $346 million, down 2.zero
percent organically versus the prior year. While chip supply stays constrained, the result’s
better than our expectations because of improved chip provide in the quarter, and energy in our
water quality test applications.
• Second quarter adjusted EBITDA margin was 9.8 p.c, down 410 foundation factors from the prior
yr. Reported operating income for the segment was $(5) million, and adjusted operating
revenue, which excludes $3 million of restructuring and realignment prices and $1 million of
shortages, unfavorable mix and higher inflation greater than offset worth realization and
productivity savings.
Supplemental information 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 leading international water technology company dedicated to solving important water and
infrastructure challenges with innovation. Our 17,000 diverse workers delivered income of $5.2
billion in 2021. We are creating a extra sustainable world by enabling our prospects to optimize water
and useful resource management, and serving to communities in more than 150 nations turn out to be watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press release accommodates “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 unfavorable, may, however are not essential to, establish
forward-looking statements. By their nature, forward-looking statements tackle uncertain matters and
embrace any statements that are not historical, similar to statements about our strategy, monetary plans,
outlook, objectives, plans, intentions or targets (including these 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, working margins and earnings per share growth.
Although we imagine that the expectations reflected in any of our forward-looking statements are
affordable, actual outcomes might differ materially from these projected or assumed in any of our forwardlooking statements. Our future monetary condition and results of operations, as properly as any forwardlooking statements, are topic to alter and to inherent risks and uncertainties, many of that are
past our management. Additionally, many of those dangers and uncertainties are, and will continue to be,
amplified by impacts from the struggle between Russia and Ukraine, in addition to the continuing coronavirus
(“COVID-19”) pandemic and related macroeconomic conditions (including inflation). Important components
that would cause our precise results, efficiency and achievements, or business results to differ
materially from estimates or projections contained in or implied by our forward-looking statements
embody, among others, the following: the impression of overall industry and basic economic circumstances,
together with industrial, governmental, and public and private sector spending and the power of the
residential and commercial actual estate markets, on financial activity and our operations; geopolitical
occasions, together with the struggle between Russia and Ukraine, and regulatory, financial and other dangers
related to our international sales and operations, together with with respect to home content material
necessities applicable to initiatives with governmental funding; continued uncertainty across the
ongoing COVID-19 pandemic’s magnitude, period and impacts on our business, operations, growth,
and financial condition; precise or potential different epidemics, pandemics or global health crises;
availability, scarcity or delays in receiving digital elements (in specific, semiconductors), parts,
and raw materials from our provide chain; manufacturing and working value increases because of
macroeconomic situations, including inflation, supply chain shortages, logistics challenges, tight labor
markets, prevailing price adjustments, tariffs and other elements; demand for our merchandise; disruption,
competition or pricing pressures within the markets we serve; cybersecurity incidents or different disruptions of
info expertise systems on which we rely, or involving our products; disruptions in operations at
our services or that of third parties upon which we rely; capacity to retain and appeal to senior administration
and different various and key expertise, in addition to competition for total expertise and labor; issue predicting
our financial results; defects, security, warranty and legal responsibility claims, and remembers with respect to merchandise;
availability, regulation or interference with radio spectrum utilized by certain of our products; uncertainty
associated to restructuring and realignment actions and related costs and savings; our capability to continue
strategic investments for progress; our capacity to successfully identify, execute and integrate acquisitions;
volatility in served markets or impacts on business and operations due to weather situations, together with
the consequences of local weather change; fluctuations in international foreign money exchange rates; our ability to borrow or
refinance our existing indebtedness and uncertainty around the availability of liquidity sufficient to satisfy
our needs; risk of future impairments to goodwill and different intangible belongings; failure to comply with, or
adjustments in, legal guidelines or regulations, including these pertaining to anti-corruption, information privateness and safety,
export and import, competition, and the setting and local weather 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 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 in this press release relating to our environmental and different
sustainability plans and targets usually are not an indication that these statements are essentially materials to
traders or are required to be disclosed in our filings with the SEC. In addition, historic, current, and
forward-looking social, environmental and sustainability associated statements could also be primarily based on requirements
for measuring progress which are nonetheless growing, internal controls and processes that proceed to evolve,
and assumptions that are topic to vary sooner or later. All forward-looking statements made herein
are primarily based on info at present out there to us as of the date of this press release. We undertake no
obligation to publicly replace or revise any forward-looking statements, whether or not on account of new
data, future occasions or otherwise, besides as required by legislation
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