Benzinga | Nov 2, 2021 04:43PM EDT

Xylem Reports Mixed Q3 Results, Cuts FY21 Outlook

* Xylem Inc (NYSE:XYL) reported third-quarter FY21 revenue growth of 4% year-over-year to $1.27 billion and +2% on an organic basis, missing the consensus of $1.29 billion.

* Sales by segments: Water Infrastructure $547 million (+4% Y/Y), Applied Water $400 million (+10% Y/Y), and Measurement & Control Solutions $318 million (-4% Y/Y).

* The company recorded a 20% organic orders growth from underlying solid demand across segments.

* Adjusted EPS of $0.63 beat the consensus of $0.59.

* The gross margin contracted by 47 bps to 37.3%. The operating income increased to $152 million from $73 million a year ago, and the margin expanded by 603 bps to 12%.

* Xylem generated cash from operating activities year-to-date of $318 million, compared to $454 million a year ago.

* Adjusted EBITDA was $227 million, compared to $222 million in 3Q20, and margin down 30 bps to 17.9%.

* FY21 Outlook: Xylem expects organic revenue growth of 3% - 4%, representing ~$5.1 billion - $5.2 billion on a reported basis (prior view 6%-8%, or $5.3 billion - $5.4 billion) vs. consensus of $5.30 billion.

* It expects adjusted EPS of $2.40 - $2.50, (prior $2.55 - $2.70) vs. consensus of $2.58.

* Price Action: XYL shares closed lower by 0.15% at $129.08 on Tuesday.