Xylem Reports Second Quarter 2022 Results

FEATUREDMINING

Xylem Reports Second Quarter 2022 Results

by Brenna ShumbamhiniAugust 2, 2022

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Robust continuing demand drove strong organic orders progress: 1% on a reported

basis, 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 basis points

• Raising full-year natural revenue steering to a spread 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 quantity one world water expertise

company dedicated to fixing the world’s most difficult water points, today reported second quarter

income of $1.4 billion, surpassing previous steerage in every business section. Strong continued

global demand drove orders and backlog progress across the portfolio.
Second quarter adjusted earnings earlier than curiosity, tax, depreciation and amortization (EBITDA) margin

was sixteen.6 percent, better than the Company’s previous steering and reflecting a year-over-year

lower of 70 basis points. Inflation and the influence of continuous chip shortages drove the margin

decline, exceeding the advantages of worth realization and productiveness financial savings. Xylem generated internet

revenue of $112 million, or $0.62 per share, and adjusted internet revenue of $120 million, or $0.sixty six per share,
which excludes the impression of restructuring, realignment and particular expenses.
“The group delivered very sturdy second quarter efficiency on all key metrics, and nicely forward of our

steerage for the quarter,” mentioned Patrick Decker, Xylem president and CEO. “The end result displays our

commercial momentum on persevering with underlying demand, disciplined operational execution, and a

average easing in chip provide constraints.”

“On the strength of strong backlog and orders development, and the team’s demonstrated success mitigating

the effects of inflation, we are raising our full-year steerage on income and earnings. This additional

reinforces our longer-term growth and worth creation thesis for Xylem.”

Outlook

Xylem now expects full-year 2022 natural revenue development to be within the range of 8 to 10 p.c, and three

to 5 percent on a reported basis. This represents a rise from the Company’s earlier full-year

organic income steerage of four to six p.c, and 1 to 3 p.c on a reported basis. Full-year 2022

adjusted EBITDA margin is now expected to be in the range of sixteen.5 to 17.0 p.c, raising the low end

of the earlier range of sixteen.0 to 17.zero %. This results in adjusted earnings per share of $2.50 to

$2.70, raising the low finish from the previous range of $2.forty to $2.70. The elevated steering displays

strong demand, gradual easing of provide chain constraints and price realization partially offset by

inflation and foreign 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 offers steering only on a non-GAAP

basis because of the inherent problem in forecasting sure 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 phase consists of its portfolio of businesses serving clear water

supply, wastewater transport and remedy, and dewatering.
• Second quarter 2022 Water Infrastructure income was $589 million, a 9.0 p.c increase

organically in contrast with second quarter 2021. This strong progress was pushed by sturdy value

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 factors from the prior

year. Reported working earnings for the section was $108 million. Adjusted operating earnings

for the phase, which excludes $3 million of restructuring and realignment, was $111 million, a

14.4 percent increase versus the comparable period last 12 months. Reported working margin for

the section was 18.3 %, up 200 foundation factors versus the prior 12 months, and adjusted

operating margin was 18.8 %, up 180 basis factors versus the prior year. Strong worth

realization, quantity, 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, business constructing,
and residential functions.
pressure gauge 0 10 bar ราคา Applied Water revenue was $429 million, a 7.0 percent increase

organically year-over-year. The section delivered sturdy price realization and backlog

execution in industrial and residential finish markets, partially offset by continued provide chain

constraints in commercial buildings in the United States.
• Second quarter adjusted EBITDA margin was 16.1 %, down one hundred thirty basis factors from the

prior 12 months. Reported operating income for the segment was $61 million and adjusted working

earnings, which excludes $2 million of restructuring and realignment costs, was $63 million, a four.5

p.c decrease versus the comparable period last year. The section reported operating

margin was 14.2 %, down a hundred thirty foundation points versus the prior yr interval. Adjusted

working margin declined one hundred twenty foundation points to 14.7 percent. Strong worth realization and

productiveness savings were greater than offset by inflation and decrease volume.
Measurement & Control Solutions

Xylem’s Measurement & Control Solutions section consists of its portfolio of companies in sensible

metering, community applied sciences, superior infrastructure analytics and analytic instrumentation.
• Second quarter 2022 Measurement & Control Solutions income was $346 million, down 2.0

percent organically versus the prior year. While chip supply stays constrained, the result is

higher than our expectations as a outcome of improved chip provide within the quarter, and energy in our

water quality check applications.
• Second quarter adjusted EBITDA margin was 9.8 percent, down 410 foundation factors from the prior

yr. Reported working earnings for the phase was $(5) million, and adjusted working

earnings, which excludes $3 million of restructuring and realignment prices and $1 million of

shortages, unfavorable mix and better inflation more than offset value realization and

productivity savings.
Supplemental info on Xylem’s second quarter 2022 earnings and reconciliations for certain 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 dedicated to fixing important water and

infrastructure challenges with innovation. Our 17,000 various employees delivered income of $5.2

billion in 2021. We are creating a more sustainable world by enabling our customers to optimize water

and useful resource management, and helping communities in additional than one hundred fifty countries turn into 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 related expressions or their negative, may, however aren’t essential to, identify

forward-looking statements. By their nature, forward-looking statements address uncertain issues and

embrace any statements that are not historical, corresponding to statements about our strategy, monetary plans,
outlook, goals, plans, intentions or goals (including these associated to our social, environmental and

different sustainability goals); or address attainable or future outcomes of operations or monetary performance,
together with statements regarding orders, revenues, working margins and earnings per share progress.
Although we believe that the expectations mirrored in any of our forward-looking statements are

affordable, precise outcomes might differ materially from these projected or assumed in any of our forwardlooking statements. Our future financial situation and outcomes of operations, in addition to any forwardlooking statements, are subject to change and to inherent risks and uncertainties, many of which are

past our management. Additionally, many of those dangers and uncertainties are, and will continue to be,
amplified by impacts from the war between Russia and Ukraine, in addition to the ongoing coronavirus

(“COVID-19”) pandemic and associated macroeconomic circumstances (including inflation). Important elements

that could cause our actual results, performance and achievements, or industry outcomes to differ

materially from estimates or projections contained in or implied by our forward-looking statements

embody, amongst others, the next: the impact of general business and common economic circumstances,
together with industrial, governmental, and public and private sector spending and the strength of the

residential and business real property markets, on financial exercise and our operations; geopolitical

events, together with the warfare between Russia and Ukraine, and regulatory, financial and different dangers

associated with our world sales and operations, including with respect to domestic content

necessities applicable to projects with governmental funding; continued uncertainty around the

ongoing COVID-19 pandemic’s magnitude, period and impacts on our business, operations, progress,
and monetary situation; actual or potential other epidemics, pandemics or international well being crises;
availability, scarcity or delays in receiving digital elements (in specific, semiconductors), elements,
and uncooked supplies from our supply chain; manufacturing and working value will increase because of

macroeconomic circumstances, together with inflation, supply chain shortages, logistics challenges, tight labor

markets, prevailing price adjustments, tariffs and different elements; demand for our products; disruption,
competition or pricing pressures within the markets we serve; cybersecurity incidents or other disruptions of

info technology methods on which we rely, or involving our merchandise; disruptions in operations at

our services or that of third events upon which we rely; capacity to retain and entice senior management

and other diverse and key expertise, in addition to competitors for general expertise and labor; difficulty predicting

our financial results; defects, security, guarantee and legal responsibility claims, and recollects with respect to products;
availability, regulation or interference with radio spectrum utilized by certain of our merchandise; uncertainty

associated to restructuring and realignment actions and associated expenses and financial savings; our capability to continue

strategic investments for growth; our capability to efficiently establish, execute and integrate acquisitions;
volatility in served markets or impacts on enterprise and operations as a outcome of weather situations, including

the effects of local weather change; fluctuations in foreign foreign money trade charges; our capability to borrow or

refinance our current indebtedness and uncertainty around the availability of liquidity adequate to satisfy

our wants; danger of future impairments to goodwill and other intangible assets; failure to adjust to, or

changes in, legal guidelines or laws, including those pertaining to anti-corruption, information privateness and safety,
export and import, competitors, and the setting and local weather change; adjustments in our effective tax

charges or tax expenses; legal, governmental or regulatory claims, investigations or proceedings and

associated contingent liabilities; and different elements set forth under “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 launch concerning our environmental and other

sustainability plans and goals aren’t 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 related statements could additionally be primarily based on requirements

for measuring progress that are still creating, inner controls and processes that proceed to evolve,
and assumptions that are subject to alter in the future. All forward-looking statements made herein

are primarily based on data currently available to us as of the date of this press release. We undertake no

obligation to publicly update or revise any forward-looking statements, whether as a outcome of new

data, future occasions or in any other case, besides as required by regulation

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