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Xylem Reports Second Quarter 2022 Results
by Brenna ShumbamhiniAugust 2, 2022
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Robust persevering with demand drove sturdy natural orders growth: 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 one hundred sixty foundation points
• Raising full-year organic income steering to a variety of 8% to 10% from 4% to
6%, and adjusted EPS to a range 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
company devoted to fixing the world’s most difficult water issues, right now reported second quarter
revenue of $1.4 billion, surpassing earlier steering in every business segment. Strong continued
international demand drove orders and backlog progress across the portfolio.
Second quarter adjusted earnings earlier than interest, tax, depreciation and amortization (EBITDA) margin
was 16.6 p.c, better than the Company’s earlier steering and reflecting a year-over-year
lower of 70 basis points. Inflation and the influence of constant chip shortages drove the margin
decline, exceeding the benefits of value realization and productiveness savings. Xylem generated internet
revenue of $112 million, or $0.62 per share, and adjusted web earnings of $120 million, or $0.66 per share,
which excludes the influence of restructuring, realignment and particular charges.
“The team delivered very robust second quarter efficiency on all key metrics, and nicely ahead of our
guidance for the quarter,” stated Patrick Decker, Xylem president and CEO. “The end result displays our
commercial momentum on persevering with underlying demand, disciplined operational execution, and a
reasonable easing in chip supply constraints.”
“On the energy of robust backlog and orders development, and the team’s demonstrated success mitigating
the results of inflation, we’re raising our full-year steering on revenue and earnings. This further
reinforces our longer-term development and value creation thesis for Xylem.”
Outlook
Xylem now expects full-year 2022 organic revenue growth to be in the vary of eight to 10 p.c, and 3
to 5 p.c on a reported basis. This represents a rise from the Company’s earlier full-year
natural revenue steerage of 4 to 6 percent, 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, elevating the low finish
of the previous vary of sixteen.0 to 17.zero %. This ends 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 steerage reflects
robust demand, gradual easing of provide chain constraints and value realization partially offset by
inflation and foreign change headwinds.
Further 2022 planning assumptions are included in Xylem’s second quarter 2022 earnings materials
posted at www.xylem.com/investors. Excluding income, Xylem provides guidance only on a non-GAAP
basis because of the inherent issue in forecasting certain amounts that may 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 companies serving clear water
supply, wastewater transport and remedy, and dewatering.
• Second quarter 2022 Water Infrastructure income was $589 million, a 9.0 percent enhance
organically compared with second quarter 2021. This strong progress was driven by strong worth
realization, industrial dewatering demand, and healthy 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
yr. Reported operating revenue for the segment was $108 million. Adjusted working pressure gauge น้ำ
for the segment, which excludes $3 million of restructuring and realignment, was $111 million, a
14.four % increase versus the comparable interval last year. Reported operating margin for
the section was 18.three percent, up 200 basis factors versus the prior yr, and adjusted
working margin was 18.eight p.c, up 180 basis factors versus the prior 12 months. Strong worth
realization, volume, and productiveness financial savings more than offset inflation and strategic
investments.
Applied Water
Xylem’s Applied Water section consists of its portfolio of businesses in industrial, commercial building,
and residential functions.
• Second quarter 2022 Applied Water income was $429 million, a 7.0 p.c enhance
organically year-over-year. The segment delivered sturdy value realization and backlog
execution in industrial and residential end markets, partially offset by continued provide chain
constraints in industrial buildings within the United States.
• Second quarter adjusted EBITDA margin was 16.1 percent, down a hundred thirty basis points from the
prior year. Reported operating earnings for the segment was $61 million and adjusted operating
revenue, which excludes $2 million of restructuring and realignment costs, was $63 million, a four.5
percent decrease versus the comparable period last 12 months. The section reported operating
margin was 14.2 p.c, down a hundred thirty foundation factors versus the prior 12 months interval. Adjusted
working margin declined 120 foundation points to 14.7 percent. Strong price realization and
productivity savings had been greater than offset by inflation and decrease volume.
Measurement & Control Solutions
Xylem’s Measurement & Control Solutions phase consists of its portfolio of businesses in smart
metering, community applied sciences, advanced infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions income was $346 million, down 2.0
percent organically versus the prior yr. While chip provide remains constrained, the result’s
better than our expectations because of improved chip supply in the quarter, and energy in our
water quality check functions.
• Second quarter adjusted EBITDA margin was 9.8 %, down 410 foundation factors from the prior
yr. Reported working earnings for the phase was $(5) million, and adjusted working
income, which excludes $3 million of restructuring and realignment costs and $1 million of
shortages, unfavorable combine and better inflation greater than offset price 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 technology company dedicated to fixing crucial water and
infrastructure challenges with innovation. Our 17,000 diverse employees delivered revenue of $5.2
billion in 2021. We are creating a extra sustainable world by enabling our clients to optimize water
and resource administration, and serving to communities in more than a hundred and fifty international locations become watersecure. Join us at www.xylem.com.
Forward-Looking Statements
This press release contains “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 tackle unsure matters and
embrace any statements that aren’t historical, such as statements about our technique, financial plans,
outlook, aims, plans, intentions or goals (including those associated to our social, environmental and
different sustainability goals); or tackle possible or future outcomes of operations or monetary performance,
together with statements referring to orders, revenues, operating margins and earnings per share progress.
Although we believe that the expectations reflected in any of our forward-looking statements are
reasonable, precise results may differ materially from these projected or assumed in any of our forwardlooking statements. Our future monetary situation and results of operations, as properly as any forwardlooking statements, are topic to change and to inherent risks and uncertainties, many of that are
past our management. Additionally, many of these risks and uncertainties are, and should continue to be,
amplified by impacts from the war between Russia and Ukraine, as well as the continued coronavirus
(“COVID-19”) pandemic and related macroeconomic conditions (including inflation). Important factors
that might trigger our actual outcomes, performance and achievements, or business results to differ
materially from estimates or projections contained in or implied by our forward-looking statements
embrace, among others, the next: the influence of general industry and common economic situations,
together with industrial, governmental, and public and private sector spending and the energy of the
residential and commercial real property markets, on financial activity and our operations; geopolitical
events, including the warfare between Russia and Ukraine, and regulatory, economic and other risks
associated with our world sales and operations, including with respect to domestic content
requirements relevant to projects with governmental funding; continued uncertainty across the
ongoing COVID-19 pandemic’s magnitude, duration and impacts on our business, operations, progress,
and monetary situation; precise or potential other epidemics, pandemics or international well being crises;
availability, scarcity or delays in receiving digital components (in specific, semiconductors), components,
and raw materials from our supply chain; manufacturing and operating value will increase due to
macroeconomic conditions, including inflation, provide chain shortages, logistics challenges, tight labor
markets, prevailing worth adjustments, tariffs and other elements; demand for our merchandise; disruption,
competition or pricing pressures in the markets we serve; cybersecurity incidents or other disruptions of
data know-how systems on which we rely, or involving our products; disruptions in operations at
our amenities or that of third parties upon which we rely; ability to retain and attract senior administration
and different diverse and key expertise, in addition to competition for total expertise and labor; difficulty predicting
our monetary outcomes; defects, security, warranty and liability claims, and recollects with respect to merchandise;
availability, regulation or interference with radio spectrum used by sure of our merchandise; uncertainty
related to restructuring and realignment actions and associated costs and savings; our capacity to proceed
strategic investments for growth; our capacity to successfully establish, execute and integrate acquisitions;
volatility in served markets or impacts on business and operations due to weather circumstances, together with
the consequences of local weather change; fluctuations in overseas foreign money exchange charges; our capability to borrow or
refinance our present indebtedness and uncertainty around the availability of liquidity sufficient to satisfy
our wants; threat of future impairments to goodwill and different intangible property; failure to adjust to, or
changes in, legal guidelines or laws, together with these pertaining to anti-corruption, data privateness and safety,
export and import, competitors, and the environment and climate change; adjustments in our effective tax
charges or tax expenses; authorized, governmental or regulatory claims, investigations or proceedings and
associated contingent liabilities; and other elements set forth beneath “Item 1A. Risk Factors” in our Annual
Report on Form 10-K for the year ended December 31, 2021 and in subsequent filings we make with
the Securities and Exchange Commission (“SEC”).
Forward-looking and different statements in this press launch regarding our environmental and different
sustainability plans and targets aren’t a sign that these statements are necessarily materials to
traders 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 mostly on requirements
for measuring progress which might be nonetheless growing, internal controls and processes that proceed to evolve,
and assumptions which may be topic to alter sooner or later. All forward-looking statements made herein
are based mostly on info at present out there to us as of the date of this press release. We undertake no
obligation to publicly update or revise any forward-looking statements, whether or not because of new
data, future occasions or in any other case, except as required by legislation
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