Slide 1: 2024 Third Quarter Results and Earnings
2024 Third Quarter Results and Earnings October 31, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “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,” “int
Slide 3: Q3 2024 Performance Summary
Q3 2024 Performance Summary ($ in millions, unless otherwise noted) Measurement Water Solutions Xylem Consolidated Water Infrastructure Applied Water and Control Solutions and Services Reported Q3 Adj* Q3 Reported Q3 Adj* Q3 Reported Q3 Adj* Q3 Reported Q3 Adj* Q3 Reported Q3 Adj* Q3 Orders 2,201 2,
Slide 4: Q3 2024 Earnings Highlights
Q3 2024 Earnings Highlights Record profitability driven by execution and integration momentum Healthy demand and book to bill >1, with strong orders growth across all segments Accelerating Evoqua cost synergy capture, will exit the year at $130M run rate Record Adj. EBITDA* margin and Record Quarter
Slide 5: Q3 2024 Financial Performance
Q3 2024 Financial Performance Orders Revenue Adj. EBITDA* Margin Adj. EPS* YTD Adj. Free Cash Flow* $2,201 $2,076 $2,104 21.2% $1.11 $467 $2,031 19.8% $0.99 $368 27% Organic* 8% Organic* 1% +140 bps 12% Q3 2023 Q3 2024 Q3 2023 Q3 2024 Q3 2023 Q3 2024 Q3 2023 Q3 2024 2023 2024 FCF Conversion* 94% 79%
Slide 6: Q3 2024 Segment Performance Summary
Q3 2024 Segment Performance Summary Measurement and Water Solutions Water Infrastructure Applied Water Control Solutions and Services Orders / Organic Growth* $386M +12% $700M +6% $437M +4% $678M +11% Revenue / Organic Growth* $458M +11% $623M +1% $447M (4%) $576M (1%) Adj. EBITDA* $97M $127M $83M $
Slide 7: FY 2024 and Q4 2024 Guidance
FY 2024 and Q4 2024 Guidance Prior FY Guide FY Guide Q4 Guide Full Year Highlights ~$8.55B ~$8.5B ~$2.2B Revenue ~16% Total Growth ~15% Total Growth 2-3% Total Growth 5 – 6% Organic* Growth 5% Organic* Growth 2-3% Organic* Growth • Revenue growth driven by strong demand and backlog execution Adjuste
Slide 8: Key Takeaways
Key Takeaways Strong order growth across segments Profitability improvement driven by execution and integration momentum Accelerated integration enables increased focus on capital deployment and portfolio optimization Opportunity for profitable above-market growth and shareholder value creation 8 Q3
Slide 9: Appendix
Appendix 9 Q2 2024 Results & Earnings
Slide 10: FY 2024 Guidance Key Assumptions
FY 2024 Guidance Key Assumptions FY 2024 Assumptions Corporate Expense $70M Restructuring & Realignment Costs* $60 – 80M Capex $325M Estimated Tax Rate1 22.5% Purchase Accounting Intangible Amortization $220M EUR / USD Rate 1.09 10 Q3 2024 Results & Earnings *See appendix for definitions of non-GAAP
Slide 11: Segment Key Facts
Segment Key Facts Water Solutions and Services Applied Water Treatment, transport and assessment services solutions with an Industrial and buildings solutions applications including pumps, extensive service network and highly recurring revenue valves, heat exchangers, controls, and dispensing equipm
Slide 12: Xylem Inc. Non-GAAP Measures
Xylem Inc. Non-GAAP Measures Management reviews key performance indicators including revenue, gross margins, segment operating income and margins, orders growth, working capital and backlog, among others. In addition, we consider certain non-GAAP (or "adjusted") measures to be useful to management a
Slide 13: Xylem Inc. Non-GAAP Reconciliation: Orders
Xylem Inc. Non-GAAP Reconciliation Reported vs. Organic and Constant Currency Orders ($ Millions) (As Reported - GAAP) (As Adjusted - Organic) Constant Currency (A) (B) (C) (D) (E) = B+C+D (F) = E/A (G) = (E - C) / A Change % Change Acquisitions / Change % Change Orders Orders 2024 v. 2023 2024 v. 2
Slide 14: Xylem Inc. Non-GAAP Reconciliation: Revenue
Xylem Inc. Non-GAAP Reconciliation Reported vs. Organic and Constant Currency Revenue ($ Millions) (As Reported - GAAP) (As Adjusted - Organic) Constant Currency (A) (B) (C) (D) (E) = B+C+D (F) = E/A (G) = (E - C) / A Change % Change Acquisitions / Change % Change Revenue Revenue 2024 v. 2023 2024 v
Slide 15: Xylem Inc. Non-GAAP Reconciliation: Adjusted Operating Income
Xylem Inc. Non-GAAP Reconciliation Adjusted Operating Income ($ Millions) Q1 Q2 Q3 YTD 2024 2023 2024 2023 2024 2023 2024 2023 Special Charges • Total Xylem 16 25 13 67 7 24 36 116 • Water Infrastructure 2 - 4 12 (2) 6 4 18 • Applied Water - - - - - - - - • Measurement and Control Solutions - 2 1 -
Slide 16: Xylem Inc. Non-GAAP Reconciliation: Adjusted Diluted EPS
Xylem Inc. Non-GAAP Reconciliation Adjusted Diluted EPS ($ Millions, except per share amounts) a Quarter-to-date: Restructuring & realignment costs: 2024 - $11 million and 2023 - $34 million Special charges: 2024 - $6 million of acquisition & integration cost and $1 million of other special charges;
Slide 17: Xylem Inc. Non-GAAP Reconciliation: Adjusted Diluted EPS YTD
Xylem Inc. Non-GAAP Reconciliation Adjusted Diluted EPS ($ Millions, except per share amounts) Q3 YTD 2024 Q3 YTD 2023 As Reported Adjustments Adjusted As Reported Adjustments Adjusted Total Revenue 6,306 - 6,306 5,246 - 5,246 Operating Income 742 254 a 996 441 318 a 759 Operating Margin 11.8% 15.8%
Slide 18: Xylem Inc. Non-GAAP Reconciliation: EBITDA by Quarter
Xylem Inc. Non-GAAP Reconciliation EBITDA and Adjusted EBITDA by Quarter ($ Millions) Xylem Inc. Non-GAAP Reconciliation EBITDA and Adjusted EBITDA by Quarter ($ Millions) 2024 Q1 Q2 Q3 Q4 Total Net Income 153 194 217 564 Net Income margin 7.5% 8.9% 10.3% 8.9% Depreciation 61 62 68 191 Amortization
Slide 19: Segment EBITDA Reconciliation: Water Infrastructure, Applied Water
Xylem Inc. Non-GAAP Reconciliation EBITDA and Adjusted EBITDA by Quarter ($ Millions) Xylem Inc. Non-GAAP Reconciliation EBITDA and Adjusted EBITDA by Quarter ($ Millions) Xylem Inc. Non-GAAP Reconciliation Water Infrastucture EBITDA and Adjusted EBITDA by Quarter ($ Millions) Applied Water 2024 Q1
Slide 20: Segment EBITDA Reconciliation: WSS, Measurement and Control
Xylem Inc. Non-GAAP Reconciliation EBITDA and Adjusted EBITDA by Quarter ($ Millions) Xylem Inc. Non-GAAP Reconciliation Xylem Inc. Non-GAAP Reconciliation EBITDA and Adjusted EBITDA by Quarter ($ Millions) EBITDA and Adjusted EBITDA by Quarter ($ Millions) Water Solutions and Services Measurement a
Slide 21: Net Cash Operating Activities vs. Free Cash Flow
Xylem Inc. Non-GAAP Reconciliation Net Cash – Operating Activities vs. Free Cash Flow ($ Millions) Q1 Q2 Q3 Year-to-Date 2024 2023 2024 2023 2024 2023 2024 2023 Net Cash - Operating Activities $89 ($19) $288 $28 $311 $373 $688 $382 Capital Expenditures - PPE (59) (33) (59) (42) (60) (57) (178) (132)
Slide 22: Thank you.
Thank you. Q3 2024 Earnings & Results Replay of the webcast is available until midnight November 11, 2024 Replay: +1 (877) 344-7529 or +1 (412) 317-0088 (INTL) NYSE: XYL Xylem Investor Relations Website LinkedIn | Twitter | Facebook | YouTube | Instagram