Price Graph
Price
Yield
These terms and conditions govern your use of the website alphaminr.com and its related services.
These Terms and Conditions (“Terms”) are a binding contract between you and Alphaminr, (“Alphaminr”, “we”, “us” and “service”). You must agree to and accept the Terms. These Terms include the provisions in this document as well as those in the Privacy Policy. These terms may be modified at any time.
Your subscription will be on a month to month basis and automatically renew every month. You may terminate your subscription at any time through your account.
We will provide you with advance notice of any change in fees.
You represent that you are of legal age to form a binding contract. You are responsible for any
activity associated with your account. The account can be logged in at only one computer at a
time.
The Services are intended for your own individual use. You shall only use the Services in a
manner that complies with all laws. You may not use any automated software, spider or system to
scrape data from Alphaminr.
Alphaminr is not a financial advisor and does not provide financial advice of any kind. The service is provided “As is”. The materials and information accessible through the Service are solely for informational purposes. While we strive to provide good information and data, we make no guarantee or warranty as to its accuracy.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, UNDER NO CIRCUMSTANCES SHALL ALPHAMINR BE LIABLE TO YOU FOR DAMAGES OF ANY KIND, INCLUDING DAMAGES FOR INVESTMENT LOSSES, LOSS OF DATA, OR ACCURACY OF DATA, OR FOR ANY AMOUNT, IN THE AGGREGATE, IN EXCESS OF THE GREATER OF (1) FIFTY DOLLARS OR (2) THE AMOUNTS PAID BY YOU TO ALPHAMINR IN THE SIX MONTH PERIOD PRECEDING THIS APPLICABLE CLAIM. SOME STATES DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL OR CONSEQUENTIAL OR CERTAIN OTHER DAMAGES, SO THE ABOVE LIMITATION AND EXCLUSIONS MAY NOT APPLY TO YOU.
If any provision of these Terms is found to be invalid under any applicable law, such provision shall not affect the validity or enforceability of the remaining provisions herein.
This privacy policy describes how we (“Alphaminr”) collect, use, share and protect your personal information when we provide our service (“Service”). This Privacy Policy explains how information is collected about you either directly or indirectly. By using our service, you acknowledge the terms of this Privacy Notice. If you do not agree to the terms of this Privacy Policy, please do not use our Service. You should contact us if you have questions about it. We may modify this Privacy Policy periodically.
When you register for our Service, we collect information from you such as your name, email address and credit card information.
Like many other websites we use “cookies”, which are small text files that are stored on your computer or other device that record your preferences and actions, including how you use the website. You can set your browser or device to refuse all cookies or to alert you when a cookie is being sent. If you delete your cookies, if you opt-out from cookies, some Services may not function properly. We collect information when you use our Service. This includes which pages you visit.
We use Google Analytics and we use Stripe for payment processing. We will not share the information we collect with third parties for promotional purposes. We may share personal information with law enforcement as required or permitted by law.
|
|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
Indiana
|
|
45-2080495
|
|
(State or other jurisdiction of incorporation or
organization)
|
|
(I.R.S. Employer Identification No.)
|
|
Large accelerated filer
|
|
þ
|
|
Accelerated filer
|
|
¨
|
|
|
|
|
|
|
|
|
|
Non-accelerated filer
|
|
¨
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
|
¨
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Emerging growth company
|
|
¨
|
|
|
|
ITEM
|
|
|
PAGE
|
|
PART I – Financial Information
|
|
||
|
Item 1
|
-
|
|
|
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
Item 2
|
-
|
||
|
Item 3
|
-
|
||
|
Item 4
|
-
|
||
|
PART II – Other Information
|
|
||
|
Item 1
|
-
|
||
|
Item 1A
|
-
|
||
|
Item 2
|
-
|
||
|
Item 3
|
-
|
||
|
Item 4
|
-
|
||
|
Item 5
|
-
|
||
|
Item 6
|
-
|
||
|
|
|
||
|
|
Three Months
|
|
Nine Months
|
||||||||||||
|
For the periods ended September 30,
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Revenue
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Cost of revenue
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Gross profit
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Selling, general and administrative expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Research and development expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Restructuring and asset impairment charges, net
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Operating income
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Other non-operating income (expense), net
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Gain (loss) from sale of business
|
|
|
|
(
|
)
|
|
|
|
|
|
|
||||
|
Income before taxes
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Income tax expense
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Less: Net loss attributable to non-controlling interests
|
|
|
|
(
|
)
|
|
|
|
|
|
|
||||
|
Net income attributable to Xylem
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
|
Basic
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Diluted
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Weighted average number of shares:
|
|
|
|
|
|
|
|
||||||||
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Dividends declared per share
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Three Months
|
|
Nine Months
|
||||||||||||
|
For the periods ended September 30,
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Other comprehensive income, before tax:
|
|
|
|
|
|
|
|
||||||||
|
Foreign currency translation adjustment
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Net change in derivative hedge agreements:
|
|
|
|
|
|
|
|
||||||||
|
Unrealized (losses) gains
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
||||
|
Amount of gain reclassified into net income
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net change in postretirement benefit plans:
|
|
|
|
|
|
|
|
||||||||
|
Amortization of prior service credit
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Amortization of net actuarial loss into net income
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Settlement/Curtailment
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Other comprehensive (loss) income, before tax
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Income tax (benefit) expense related to items of other comprehensive income
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
||||
|
Other comprehensive (loss) income, net of tax
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Comprehensive income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Less: comprehensive loss attributable to noncontrolling interests
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Comprehensive income attributable to Xylem
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
|
|
|
|
||||
|
ASSETS
|
|
|
|
||||
|
Current assets:
|
|
|
|
||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
Receivables, less allowances for discounts and doubtful accounts of $34 and $35 in 2018 and 2017, respectively
|
|
|
|
|
|
||
|
Inventories
|
|
|
|
|
|
||
|
Prepaid and other current assets
|
|
|
|
|
|
||
|
Total current assets
|
|
|
|
|
|
||
|
Property, plant and equipment, net
|
|
|
|
|
|
||
|
Goodwill
|
|
|
|
|
|
||
|
Other intangible assets, net
|
|
|
|
|
|
||
|
Other non-current assets
|
|
|
|
|
|
||
|
Total assets
|
$
|
|
|
|
$
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
|
Current liabilities:
|
|
|
|
||||
|
Accounts payable
|
$
|
|
|
|
$
|
|
|
|
Accrued and other current liabilities
|
|
|
|
|
|
||
|
Short-term borrowings and current maturities of long-term debt
|
|
|
|
|
|
||
|
Total current liabilities
|
|
|
|
|
|
||
|
Long-term debt
|
|
|
|
|
|
||
|
Accrued postretirement benefits
|
|
|
|
|
|
||
|
Deferred income tax liabilities
|
|
|
|
|
|
||
|
Other non-current accrued liabilities
|
|
|
|
|
|
||
|
Total liabilities
|
|
|
|
|
|
||
|
Commitments and contingencies (Note 19)
|
|
|
|
||||
|
Stockholders’ equity:
|
|
|
|
||||
|
Common Stock – par value $0.01 per share:
|
|
|
|
||||
|
Authorized 750.0 shares, issued 192.9 shares and 192.3 shares in 2018 and 2017, respectively
|
|
|
|
|
|
||
|
Capital in excess of par value
|
|
|
|
|
|
||
|
Retained earnings
|
|
|
|
|
|
||
|
Treasury stock – at cost 13.2 shares and 12.4 shares in 2018 and 2017, respectively
|
(
|
)
|
|
(
|
)
|
||
|
Accumulated other comprehensive loss
|
(
|
)
|
|
(
|
)
|
||
|
Total stockholders’ equity
|
|
|
|
|
|
||
|
Non-controlling interests
|
|
|
|
|
|
||
|
Total equity
|
|
|
|
|
|
||
|
Total liabilities and stockholders’ equity
|
$
|
|
|
|
$
|
|
|
|
For the nine months ended September 30,
|
2018
|
|
2017
|
||||
|
Operating Activities
|
|
|
|
||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
|
Depreciation
|
|
|
|
|
|
||
|
Amortization
|
|
|
|
|
|
||
|
Share-based compensation
|
|
|
|
|
|
||
|
Restructuring and asset impairment charges
|
|
|
|
|
|
||
|
Loss (gain) from sale of business
|
|
|
|
(
|
)
|
||
|
Other, net
|
|
|
|
|
|
||
|
Payments for restructuring
|
(
|
)
|
|
(
|
)
|
||
|
Changes in assets and liabilities (net of acquisitions):
|
|
|
|
||||
|
Changes in receivables
|
(
|
)
|
|
(
|
)
|
||
|
Changes in inventories
|
(
|
)
|
|
(
|
)
|
||
|
Changes in accounts payable
|
|
|
|
|
|
||
|
Other, net
|
(
|
)
|
|
|
|
||
|
Net Cash – Operating activities
|
|
|
|
|
|
||
|
Investing Activities
|
|
|
|
||||
|
Capital expenditures
|
(
|
)
|
|
(
|
)
|
||
|
Acquisitions of businesses, net of cash acquired
|
(
|
)
|
|
(
|
)
|
||
|
Proceeds from sale of assets and business, net of cash disposed
|
|
|
|
|
|
||
|
Cash received from investments
|
|
|
|
|
|
||
|
Cash paid for investments
|
|
|
|
(
|
)
|
||
|
Other, net
|
|
|
|
|
|
||
|
Net Cash – Investing activities
|
(
|
)
|
|
(
|
)
|
||
|
Financing Activities
|
|
|
|
||||
|
Short-term debt issued, net
|
|
|
|
|
|
||
|
Short-term debt repaid
|
(
|
)
|
|
(
|
)
|
||
|
Repurchase of common stock
|
(
|
)
|
|
(
|
)
|
||
|
Proceeds from exercise of employee stock options
|
|
|
|
|
|
||
|
Dividends paid
|
(
|
)
|
|
(
|
)
|
||
|
Other, net
|
|
|
|
(
|
)
|
||
|
Net Cash – Financing activities
|
|
|
|
(
|
)
|
||
|
Effect of exchange rate changes on cash
|
(
|
)
|
|
|
|
||
|
Net change in cash and cash equivalents
|
(
|
)
|
|
(
|
)
|
||
|
Cash and cash equivalents at beginning of year
|
|
|
|
|
|
||
|
Cash and cash equivalents at end of period
|
$
|
|
|
|
$
|
|
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
||||
|
Cash paid during the period for:
|
|
|
|
||||
|
Interest
|
$
|
|
|
|
$
|
|
|
|
Income taxes (net of refunds received)
|
$
|
|
|
|
$
|
|
|
|
(1)
|
Eliminates the concept of recognizing periodic hedge ineffectiveness for cash flow and net investment hedges;
|
|
(2)
|
Eliminates the benchmark interest rate concept of variable - rate instruments in cash flow hedges and allows companies to designate the contractually specified interest rate as the hedged risk;
|
|
(3)
|
Requires a company to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported; and
|
|
(in millions)
|
Amount
|
||
|
Cash
|
$
|
|
|
|
Receivables
|
|
|
|
|
Inventories
|
|
|
|
|
Prepaid and other current assets
|
|
|
|
|
Property, plant and equipment
|
|
|
|
|
Intangible assets
|
|
|
|
|
Other long-term assets
|
|
|
|
|
Accounts payable
|
(
|
)
|
|
|
Accrued and other current liabilities
|
(
|
)
|
|
|
Deferred income tax liabilities
|
(
|
)
|
|
|
Other non-current accrued liabilities
|
(
|
)
|
|
|
Total identifiable net assets
|
|
|
|
|
|
|
||
|
Goodwill
|
|
|
|
|
Total consideration
|
$
|
|
|
|
Category
|
|
Life
|
|
Amount (in millions)
|
||
|
Customer Relationships
|
|
17 - 18 years
|
|
$
|
|
|
|
Technology
|
|
3 - 10 years
|
|
|
|
|
|
Tradenames
|
|
20 years
|
|
|
|
|
|
Internally Developed Software
|
|
3 years
|
|
|
|
|
|
Total
|
|
|
|
$
|
|
|
|
(in millions)
|
Three Months
|
Nine Months
|
||
|
For the period ended September 30,
|
2018
|
2017
|
2018
|
2017
|
|
Revenue
|
N/A
|
$
|
$
|
$
|
|
Net income
|
N/A
|
$
|
$
|
$
|
|
•
|
Adjustments to the depreciation of property, plant and equipment reflecting the impact of the calculated fair value of those assets in accordance with purchase accounting
|
|
•
|
Adjustments to interest expense to remove historical Pure interest costs and reflect Xylem's current debt profile
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||
|
(in millions)
|
September 30, 2018
|
|
September 30, 2018
|
||||
|
Revenue from contracts with customers
|
$
|
|
|
|
$
|
|
|
|
Other
|
|
|
|
|
|
||
|
Total
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||
|
(in millions)
|
September 30, 2018
|
|
September 30, 2018
|
||||
|
Water Infrastructure
|
|
|
|
||||
|
Transport
|
$
|
|
|
|
$
|
|
|
|
Treatment
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Applied Water
|
|
|
|
||||
|
Commercial Building Services
|
|
|
|
|
|
||
|
Residential Building Services
|
|
|
|
|
|
||
|
Industrial Water
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Measurement and Control Solutions
|
|
|
|
||||
|
Water
|
|
|
|
|
|
||
|
Electric
|
|
|
|
|
|
||
|
Gas
|
|
|
|
|
|
||
|
Software and Services/Other
|
|
|
|
|
|
||
|
Test
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Total
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||
|
(in millions)
|
September 30, 2018
|
|
September 30, 2018
|
||||
|
Water Infrastructure
|
|
|
|
||||
|
United States
|
$
|
|
|
|
$
|
|
|
|
Europe
|
|
|
|
|
|
||
|
Emerging Markets & Other
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Applied Water
|
|
|
|
||||
|
United States
|
|
|
|
|
|
||
|
Europe
|
|
|
|
|
|
||
|
Emerging Markets & Other
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Measurement and Control Solutions
|
|
|
|
||||
|
United States
|
|
|
|
|
|
||
|
Europe
|
|
|
|
|
|
||
|
Emerging Markets & Other
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Total
|
$
|
|
|
|
$
|
|
|
|
(in millions)
|
Contract Assets (a)
|
Contract Liabilities
|
||||
|
Balance at 1/1/2018
|
$
|
|
|
$
|
|
|
|
Additions, net
|
|
|
|
|
||
|
Revenue recognized from opening balance
|
—
|
|
(
|
)
|
||
|
Billings
|
(
|
)
|
—
|
|
||
|
Other
|
(
|
)
|
(
|
)
|
||
|
Balance at 9/30/2018
|
$
|
|
|
$
|
|
|
|
(a)
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
(in millions)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
By component:
|
|
|
|
|
|
|
|
||||||||
|
Severance and other charges
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Lease related charges
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Other restructuring charges
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Reversal of restructuring accruals
|
|
|
|
|
|
|
|
|
|
(
|
)
|
||||
|
Total restructuring charges
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Asset impairment
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total restructuring and asset impairment charges
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
By segment:
|
|
|
|
|
|
|
|
||||||||
|
Water Infrastructure
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Corporate and other
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
(in millions)
|
|
2018
|
|
2017
|
||||
|
Restructuring accruals - January 1
|
|
$
|
|
|
|
$
|
|
|
|
Restructuring charges
|
|
|
|
|
|
|
||
|
Cash payments
|
|
(
|
)
|
|
(
|
)
|
||
|
Foreign currency and other
|
|
(
|
)
|
|
|
|
||
|
Restructuring accruals - September 30
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
||||
|
By segment:
|
|
|
|
|
||||
|
Water Infrastructure
|
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
|
||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
||
|
Regional selling locations (a)
|
|
|
|
|
|
|
||
|
Corporate and other
|
|
|
|
|
|
|
||
|
|
|
|
|
|
2018
|
|
2017
|
||
|
Planned reductions - January 1
|
|
|
|
|
|
|
|
Additional planned reductions
|
|
|
|
|
|
|
|
Actual reductions and reversals
|
|
(
|
)
|
|
(
|
)
|
|
Planned reductions - September 30
|
|
|
|
|
|
|
|
(in millions)
|
|
Water Infrastructure
|
|
Applied Water
|
|
Measurement & Control Solutions
|
|
Corporate
|
|
Total
|
||||||||||
|
Actions Commenced in 2018:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total expected costs
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Costs incurred during Q1 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q2 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q3 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total expected costs remaining
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Actions Commenced in 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total expected costs
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Costs incurred during 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q1 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q2 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q3 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total expected costs remaining
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Actions Commenced in 2016:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total expected costs
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Costs incurred during 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q1 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q2 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs incurred during Q3 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total expected costs remaining
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Net income attributable to Xylem (in millions)
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Shares (in thousands):
|
|
|
|
|
|
|
|
||||||||
|
Weighted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Add: Participating securities (a)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Weighted average common shares outstanding — Basic
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Plus incremental shares from assumed conversions: (b)
|
|
|
|
|
|
|
|
||||||||
|
Dilutive effect of stock options
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Dilutive effect of restricted stock units and performance share units
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Weighted average common shares outstanding — Diluted
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Basic earnings per share
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Diluted earnings per share
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
(a)
|
|
|
(b)
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
|
September 30,
|
|
September 30,
|
||||||||
|
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
|
Stock options
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted stock units
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance share units
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions)
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
Finished goods
|
$
|
|
|
|
$
|
|
|
|
Work in process
|
|
|
|
|
|
||
|
Raw materials
|
|
|
|
|
|
||
|
Total inventories
|
$
|
|
|
|
$
|
|
|
|
(in millions)
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
Land, buildings and improvements
|
$
|
|
|
|
$
|
|
|
|
Machinery and equipment
|
|
|
|
|
|
||
|
Equipment held for lease or rental
|
|
|
|
|
|
||
|
Furniture and fixtures
|
|
|
|
|
|
||
|
Construction work in progress
|
|
|
|
|
|
||
|
Other
|
|
|
|
|
|
||
|
Total property, plant and equipment, gross
|
|
|
|
|
|
||
|
Less accumulated depreciation
|
|
|
|
|
|
||
|
Total property, plant and equipment, net
|
$
|
|
|
|
$
|
|
|
|
(in millions)
|
Water
Infrastructure
|
|
Applied Water
|
|
Measurement & Control Solutions
|
|
Total
|
||||||||
|
Balance as of January 1, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Activity in 2018
|
|
|
|
|
|
|
|
||||||||
|
Divested/Acquired
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Foreign currency and other
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Balance as of September 30, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
(in millions)
|
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Intangibles
|
|
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Intangibles
|
||||||||||||
|
Customer and distributor relationships
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Proprietary technology and patents
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||||
|
Trademarks
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||||
|
Software
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||||
|
Other
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||||
|
Indefinite-lived intangibles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Other Intangibles
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
(in millions)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Cash Flow Hedges
|
|
|
|
|
|
|
|
||||||||
|
Foreign Exchange Contracts
|
|
|
|
|
|
|
|
||||||||
|
Amount of gain (loss) recognized in OCI (a)
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Amount of (gain) loss reclassified from OCI into revenue (a)
|
|
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Amount of loss reclassified from OCI into cost of revenue (a)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Net Investment Hedges
|
|
|
|
|
|
|
|
||||||||
|
Cross Currency Swaps
|
|
|
|
|
|
|
|
||||||||
|
Amount of gain (loss) recognized in OCI (a)
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Foreign Currency Denominated Debt
|
|
|
|
|
|
|
|
||||||||
|
Amount of gain (loss) recognized in OCI (a)
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
(a)
|
|
|
(in millions)
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
Derivatives designated as hedging instruments
|
|
|
|
||||
|
Assets
|
|
|
|
||||
|
Cash Flow Hedges
|
|
|
|
||||
|
Other current assets
|
$
|
|
|
|
$
|
|
|
|
Liabilities
|
|
|
|
||||
|
Cash Flow Hedges
|
|
|
|
||||
|
Other current liabilities
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
Net Investment Hedges
|
|
|
|
||||
|
Other non-current liabilities
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
(in millions)
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
Compensation and other employee benefits
|
$
|
|
|
|
$
|
|
|
|
Customer-related liabilities
|
|
|
|
|
|
||
|
Accrued taxes
|
|
|
|
|
|
||
|
Accrued warranty costs
|
|
|
|
|
|
||
|
Other accrued liabilities
|
|
|
|
|
|
||
|
Total accrued and other current liabilities
|
$
|
|
|
|
$
|
|
|
|
(in millions)
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
4.875% Senior Notes due 2021 (a)
|
$
|
|
|
|
$
|
|
|
|
2.250% Senior Notes due 2023 (a)
|
|
|
|
|
|
||
|
3.250% Senior Notes due 2026 (a)
|
|
|
|
|
|
||
|
4.375% Senior Notes due 2046 (a)
|
|
|
|
|
|
||
|
Commercial paper
|
|
|
|
|
|
||
|
Research and development finance contract
|
|
|
|
|
|
||
|
Term loan
|
|
|
|
|
|
||
|
Debt issuance costs and unamortized discount (b)
|
(
|
)
|
|
(
|
)
|
||
|
Total debt
|
|
|
|
|
|
||
|
Less: short-term borrowings and current maturities of long-term debt
|
|
|
|
|
|
||
|
Total long-term debt
|
$
|
|
|
|
$
|
|
|
|
(a)
|
|
|
(b)
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
(in millions)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Domestic defined benefit pension plans:
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Interest cost
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Expected return on plan assets
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Amortization of net actuarial loss
|
|
|
|
—
|
|
|
|
|
|
|
|
||||
|
Net periodic benefit cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
International defined benefit pension plans:
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Interest cost
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Expected return on plan assets
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Amortization of net actuarial loss
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Settlement/Curtailment
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net periodic benefit cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Total net periodic benefit cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Common
Stock |
|
Capital in Excess of Par Value |
|
Retained
Earnings |
|
Accumulated Other
Comprehensive Income (Loss) |
|
Treasury Stock
|
|
Non-Controlling Interest
|
|
Total
|
||||||||||||||
|
Balance at January 1, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
Cumulative effect of change in accounting principle
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|
(
|
)
|
|||||||||||
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Other comprehensive income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Dividends declared ($0.21 per share)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Stock incentive plan activity
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|||||||||||
|
Repurchase of common stock
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
(
|
)
|
||||||||||||
|
Balance at March 31, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Other comprehensive loss, net
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Dividends declared ($0.21 per share)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Stock incentive plan activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Repurchase of common stock
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
(
|
)
|
||||||||||||
|
Balance at June 30, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|||||||||||
|
Other comprehensive loss, net
|
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||
|
Dividends declared ($0.21 per share)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Stock incentive plan activity
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|||||||||||
|
Repurchase of common stock
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||||
|
Balance at September 30, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
|
Common
Stock |
|
Capital in Excess of Par Value |
|
Retained
Earnings |
|
Accumulated Other
Comprehensive Income (Loss) |
|
Treasury Stock
|
|
Non-Controlling Interest
|
|
Total
|
||||||||||||||
|
Balance at January 1, 2017
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
Cumulative effect of change in accounting principle
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Other comprehensive income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Dividends declared ($0.18 per share)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Stock incentive plan activity
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|||||||||||
|
Repurchase of common stock
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||||
|
Balance at March 31, 2017
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Other comprehensive income, net
|
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||||||||
|
Dividends declared ($0.18 per share)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Stock incentive plan activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Repurchase of common stock
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
(
|
)
|
||||||||||||
|
Balance at June 30, 2017
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||||||||
|
Other comprehensive income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Dividends declared ($0.18 per share)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
||||||||||||
|
Stock incentive plan activity
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|||||||||||
|
Repurchase of common stock
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||||
|
Balance at September 30, 2017
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
|
Share units
(in thousands)
|
|
Weighted
Average
Exercise
Price / Share
|
|
Weighted Average
Remaining
Contractual
Term (Years)
|
|
Aggregate Intrinsic Value
(in millions)
|
|||||
|
Outstanding at January 1, 2018
|
|
|
|
$
|
|
|
|
|
|
|
||
|
Granted
|
|
|
|
|
|
|
|
|
|
|||
|
Exercised
|
(
|
)
|
|
|
|
|
|
|
|
|||
|
Forfeited and expired
|
(
|
)
|
|
|
|
|
|
|
|
|||
|
Outstanding at September 30, 2018
|
|
|
|
$
|
|
|
|
|
|
$
|
|
|
|
Options exercisable at September 30, 2018
|
|
|
|
$
|
|
|
|
|
|
$
|
|
|
|
Vested and expected to vest as of September 30, 2018
|
|
|
|
$
|
|
|
|
|
|
$
|
|
|
|
Volatility
|
|
|
%
|
|
|
Risk-free interest rate
|
|
|
%
|
|
|
Dividend yield
|
|
|
%
|
|
|
Expected term (in years)
|
|
|
|
|
|
Weighted-average fair value / share
|
$
|
|
|
|
|
|
Share units
(in thousands)
|
|
Weighted
Average
Grant Date
Fair Value /Share
|
|||
|
Outstanding at January 1, 2018
|
|
|
|
$
|
|
|
|
Granted
|
|
|
|
|
|
|
|
Vested
|
(
|
)
|
|
|
|
|
|
Forfeited
|
(
|
)
|
|
|
|
|
|
Outstanding at September 30, 2018
|
|
|
|
$
|
|
|
|
|
Share units
(in thousands)
|
|
Weighted
Average
Grant Date
Fair Value /Share
|
|||
|
Outstanding at January 1, 2018
|
|
|
|
$
|
|
|
|
Granted
|
|
|
|
|
|
|
|
Forfeited
|
(
|
)
|
|
|
|
|
|
Outstanding at September 30, 2018
|
|
|
|
$
|
|
|
|
|
Share units
(in thousands)
|
|
Weighted
Average
Grant Date
Fair Value /Share
|
|||
|
Outstanding at January 1, 2018
|
|
|
|
$
|
|
|
|
Granted
|
|
|
|
|
|
|
|
Forfeited
|
(
|
)
|
|
|
|
|
|
Outstanding at September 30, 2018
|
|
|
|
$
|
|
|
|
Volatility
|
|
%
|
|
Risk-free interest rate
|
|
%
|
|
(in millions)
|
Foreign Currency Translation
|
|
Postretirement Benefit Plans
|
|
Derivative Instruments
|
|
Total
|
||||||||
|
Balance at July 1, 2018
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
Foreign currency translation adjustment
|
(
|
)
|
|
—
|
|
|
—
|
|
|
(
|
)
|
||||
|
Tax on foreign currency translation adjustment
|
|
|
|
—
|
|
|
—
|
|
|
|
|
||||
|
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net
|
|
|
|
|
|
|
|
|
|
||||||
|
Reclassification of unrealized loss on foreign exchange agreements into revenue
|
—
|
|
|
—
|
|
|
|
|
|
|
|
||||
|
Reclassification of unrealized loss on foreign exchange agreements into cost of revenue
|
—
|
|
|
—
|
|
|
|
|
|
|
|
||||
|
Balance at September 30, 2018
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
(in millions)
|
Foreign Currency Translation
|
|
Postretirement Benefit Plans
|
|
Derivative Instruments
|
|
Total
|
||||||||
|
Balance at January 1, 2018
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Cumulative effect of change in accounting principle
|
(
|
)
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
||||
|
Foreign currency translation adjustment
|
(
|
)
|
|
—
|
|
|
—
|
|
|
(
|
)
|
||||
|
Tax on foreign currency translation adjustment
|
(
|
)
|
|
—
|
|
|
—
|
|
|
(
|
)
|
||||
|
Changes in postretirement benefit plans
|
—
|
|
|
|
|
|
—
|
|
|
|
|
||||
|
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net
|
—
|
|
|
|
|
|
—
|
|
|
|
|
||||
|
Income tax impact on amortization of postretirement benefit plan items
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
||||
|
Unrealized loss on derivative hedge agreements
|
—
|
|
|
—
|
|
|
(
|
)
|
|
(
|
)
|
||||
|
Reclassification of unrealized gain on foreign exchange agreements into revenue
|
—
|
|
|
—
|
|
|
(
|
)
|
|
(
|
)
|
||||
|
Reclassification of unrealized loss on foreign exchange agreements into cost of revenue
|
—
|
|
|
—
|
|
|
|
|
|
|
|
||||
|
Balance at September 30, 2018
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
(in millions)
|
2018
|
|
2017
|
||||
|
Warranty accrual – January 1
|
$
|
|
|
|
$
|
|
|
|
Net charges for product warranties in the period
|
|
|
|
|
|
||
|
Settlement of warranty claims
|
(
|
)
|
|
(
|
)
|
||
|
Foreign currency and other
|
|
|
|
|
|
||
|
Warranty accrual - September 30
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
(in millions)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Revenue:
|
|
|
|
|
|
|
|
||||||||
|
Water Infrastructure
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Operating Income:
|
|
|
|
|
|
|
|
||||||||
|
Water Infrastructure
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Corporate and other
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Total operating income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Interest expense
|
$
|
|
|
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Other non-operating income (expense), net
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Gain (loss) from sale of business
|
|
|
|
(
|
)
|
|
|
|
|
|
|
||||
|
Income before taxes
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Depreciation and Amortization:
|
|
|
|
|
|
|
|
||||||||
|
Water Infrastructure
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Regional selling locations (a)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Corporate and other
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Capital Expenditures:
|
|
|
|
|
|
|
|
||||||||
|
Water Infrastructure
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Regional selling locations (b)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Corporate and other
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(in millions)
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
Water Infrastructure
|
$
|
|
|
|
$
|
|
|
|
Applied Water
|
|
|
|
|
|
||
|
Measurement & Control Solutions
|
|
|
|
|
|
||
|
Regional selling locations (a)
|
|
|
|
|
|
||
|
Corporate and other (b)
|
|
|
|
|
|
||
|
Total
|
$
|
|
|
|
$
|
|
|
|
(a)
|
|
|
(b)
|
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
•
|
Water Infrastructure
serves the water infrastructure sector with pump systems that transport water from aquifers, lakes, rivers and seas; with filtration, ultraviolet and ozone systems that provide treatment, making the water fit to use; and pumping solutions that move the wastewater to treatment facilities where our mixers, biological treatment, monitoring and control systems provide the primary functions in the treatment process. We also provide sales and rental of specialty dewatering pumps and related equipment and services. In the Water Infrastructure segment, we provide the majority of our sales
|
|
•
|
Applied Water
serves the usage applications sector with water pressure boosting systems for heating, ventilation and air conditioning and for fire protection systems to the residential and commercial building services markets. In addition, our pumps, heat exchangers and controls provide cooling to power plants and manufacturing facilities, as well as circulation for food and beverage processing. We also provide boosting systems for farming irrigation. In the Applied Water segment, we provide the majority of our sales through long-standing relationships with many of the leading independent distributors in the markets we serve, with the remainder going directly to customers.
|
|
•
|
Measurement & Control Solutions
primarily
serves the utility infrastructure solutions and services sector by delivering communications, smart metering, critical infrastructure technologies, measurement and control technologies and services that allow customers to more effectively use their distribution networks for the delivery of critical resources such as water, electricity and natural gas. In the Measurement & Control Solutions segment, we also provide analytical instrumentation used to measure water quality, flow and level in wastewater, surface water and coastal environments. Additionally, we sell software and services including cloud-based analytics, remote monitoring and data management, leak detection and pressure monitoring solutions. We also sell smart lighting products and solutions that improve efficiency and public safety efforts across communities. In the Measurement & Control Solutions segment, we generate our sales through a combination of long-standing relationships with leading distributors and dedicated channel partners as well as direct sales depending on the regional availability of distribution channels and the type of product.
|
|
•
|
Orders of
$1,356 million
, up
8.6%
from
$1,249 million
in the prior year, up
8.3
% on an organic basis
|
|
•
|
Earnings per share of
$0.72
, up
24.1%
from the prior year (
$0.77
, up
18.5%
on an adjusted basis)
|
|
•
|
Cash flow from operating activities of
$388 million
for the
nine months ended September 30, 2018
, up
2.4%
from the prior year. Free cash flow, excluding Sensus acquisition related costs, of $
218 million
as compared to $283 million in the prior year, as higher operating cash flows were offset by increased spending on capital investments and software development costs.
|
|
•
|
"organic revenue" and "organic orders" defined as revenue and orders, respectively, excluding the impact of fluctuations in foreign currency translation and contributions from acquisitions and divestitures. Divestitures include sales of insignificant portions of our business that did not meet the criteria for classification as a discontinued operation. The period-over-period change resulting from foreign currency translation impacts is determined by translating current period and prior period activity using the same currency conversion rate.
|
|
•
|
"constant currency" defined as financial results adjusted for foreign currency translation impacts by translating current period and prior period activity using the same currency conversion rate. This approach is used for countries whose functional currency is not the U.S. dollar.
|
|
•
|
"adjusted net income" and "adjusted earnings per share" defined as net income and earnings per share, respectively, adjusted to exclude restructuring and realignment costs, Sensus acquisition related costs, special charges, gains and losses from the sale of businesses and tax-related special items, as applicable. A reconciliation of adjusted net income is provided below.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
(In millions, except for per share data)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Net income attributable to Xylem
|
$
|
130
|
|
|
$
|
105
|
|
|
$
|
324
|
|
|
$
|
260
|
|
|
Earnings per share - diluted
|
$
|
0.72
|
|
|
$
|
0.58
|
|
|
$
|
1.79
|
|
|
$
|
1.44
|
|
|
Restructuring and realignment, net of tax of $3 and $10 for 2018 and net of tax of $4 and $11 for 2017
|
8
|
|
|
5
|
|
|
27
|
|
|
21
|
|
||||
|
Sensus acquisition related costs, net of tax of $2 and $7 for 2017
|
—
|
|
|
3
|
|
|
—
|
|
|
12
|
|
||||
|
Special charges, net of tax of $0 and $1 for 2018 and net of tax of $1 and $3 for 2017
|
1
|
|
|
2
|
|
|
7
|
|
|
5
|
|
||||
|
Tax-related special items
|
2
|
|
|
3
|
|
|
5
|
|
|
—
|
|
||||
|
(Gain) loss from sale of business, net of tax of $0 and $0 for 2018 and $0 and $2 for 2017
|
(2
|
)
|
|
1
|
|
|
—
|
|
|
(2
|
)
|
||||
|
Adjusted net income
|
$
|
139
|
|
|
$
|
119
|
|
|
$
|
363
|
|
|
$
|
296
|
|
|
Adjusted earnings per share
|
$
|
0.77
|
|
|
$
|
0.65
|
|
|
$
|
2.00
|
|
|
$
|
1.64
|
|
|
•
|
"operating expenses excluding restructuring and realignment costs, Sensus acquisition related costs and special charges" defined as operating expenses, adjusted to exclude restructuring and realignment costs, Sensus acquisition related costs and special charges.
|
|
•
|
"adjusted operating income" defined as operating income, adjusted to exclude restructuring and realignment costs, Sensus acquisition related costs and special charges, and "adjusted operating margin" defined as adjusted operating income divided by total revenue.
|
|
•
|
“realignment costs” defined as costs not included in restructuring costs that are incurred as part of actions taken to reposition our business, including items such as professional fees, severance, relocation, travel, facility set-up and other costs.
|
|
•
|
"Sensus acquisition related costs" defined as costs incurred by the Company associated with the acquisition of Sensus that are being reported within operating income. These costs include integration costs, acquisition costs, costs related to the recognition of the backlog intangible asset amortization recorded in purchase accounting.
|
|
•
|
“special charges" defined as costs incurred by the Company, such as non-cash impairment charges, acquisition and integration related costs not related to Sensus, due diligence costs and other special non-operating items.
|
|
•
|
"tax-related special items" defined as tax items, such as tax return versus tax provision adjustments, tax exam impacts, tax law change impacts, significant reserves for cash repatriation, excess tax benefits/losses and other discrete tax adjustments.
|
|
•
|
"free cash flow" defined as net cash from operating activities, as reported in the Statement of Cash Flow, less capital expenditures as well as adjustments for other significant items that impact current results which management believes are not related to our ongoing operations and performance. Our definition of free cash flow does not consider certain non-discretionary cash payments, such as debt. The following table provides a reconciliation of free cash flow.
|
|
|
Nine Months Ended
|
||||||
|
|
September 30,
|
||||||
|
(In millions)
|
2018
|
|
2017
|
||||
|
Net cash provided by operating activities
|
$
|
388
|
|
|
$
|
379
|
|
|
Capital expenditures
|
(171
|
)
|
|
(119
|
)
|
||
|
Free cash flow
|
$
|
217
|
|
|
$
|
260
|
|
|
Cash paid for Sensus acquisition related costs
|
$
|
(1
|
)
|
|
$
|
(23
|
)
|
|
Free cash flow, excluding Sensus acquisition related costs
|
$
|
218
|
|
|
$
|
283
|
|
|
•
|
“EBITDA” defined as earnings before interest, taxes, depreciation and amortization expense and "Adjusted EBITDA" reflects the adjustment to EBITDA to exclude share-based compensation, restructuring and realignment costs, Sensus acquisition related costs, special charges and gain or loss from sale of businesses.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
(in millions)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Net Income
|
$
|
130
|
|
|
$
|
104
|
|
|
$
|
324
|
|
|
$
|
260
|
|
|
Income tax expense
|
31
|
|
|
27
|
|
|
82
|
|
|
62
|
|
||||
|
Interest expense (income), net
|
20
|
|
|
20
|
|
|
60
|
|
|
60
|
|
||||
|
Depreciation
|
29
|
|
|
28
|
|
|
87
|
|
|
83
|
|
||||
|
Amortization
|
34
|
|
|
30
|
|
|
108
|
|
|
91
|
|
||||
|
EBITDA
|
$
|
244
|
|
|
$
|
209
|
|
|
$
|
661
|
|
|
$
|
556
|
|
|
Share-based compensation
|
$
|
7
|
|
|
$
|
5
|
|
|
23
|
|
|
16
|
|
||
|
Restructuring and realignment
|
11
|
|
|
9
|
|
|
36
|
|
|
32
|
|
||||
|
Sensus acquisition related costs
|
—
|
|
|
3
|
|
|
—
|
|
|
12
|
|
||||
|
Special charges
|
1
|
|
|
3
|
|
|
8
|
|
|
8
|
|
||||
|
(Gain) loss from sale of business
|
(2
|
)
|
|
1
|
|
|
—
|
|
|
(4
|
)
|
||||
|
Adjusted EBITDA
|
$
|
261
|
|
|
$
|
230
|
|
|
$
|
728
|
|
|
$
|
620
|
|
|
•
|
Utilities revenue increased approximately 9% organically through the third quarter led by strength in North America and Asia Pacific. In 2018 we expect organic revenue growth in the high-single-digits with stable growth in the U.S. from water and wastewater spending and mixed but stable low-single-digit growth in Europe. We also anticipate high-single-digit growth from the smart meter market and infrastructure analytics along with healthy infrastructure investments and continued focus in emerging markets with projects in China, India and Latin America.
|
|
•
|
Industrial revenue increased approximately 6% organically through the third quarter lead by strength in North America and western Europe. In 2018 we expect organic revenue growth in the mid-single-digits driven by solid industrial conditions in both the U.S. and Europe along with continued recovery in the oil and gas markets in North America. We also anticipate mixed emerging market conditions with strength in China, India and Latin America offset by softness in the Middle East.
|
|
•
|
In the commercial markets, organic growth was approximately 8% through the third quarter driven by strength in the U.S and Asia Pacific. In 2018 we expect organic revenue growth in the high-single-digits driven by continued strength in the U.S. and the emerging markets led by initiatives in the India and China building markets. We expect growth in Europe to stabilize after 2 plus years of strong performance.
|
|
•
|
In residential markets, organic growth was approximately 2% through the third quarter driven by strength in western Europe which was partially offset by weakness in the U.S. and Asia Pacific. In 2018 we expect organic revenue growth in the low-single-digits driven by competition in the U.S. replacement market, market share gains from an increased selling focus in Europe and increased demand in China and other Asia Pacific countries for secondary clean water sources.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||||||||||
|
(In millions)
|
2018
|
|
2017
|
|
Change
|
|
2018
|
|
2017
|
|
Change
|
||||||||||||
|
Revenue
|
$
|
1,287
|
|
|
$
|
1,195
|
|
|
7.7
|
|
%
|
|
$
|
3,821
|
|
|
$
|
3,430
|
|
|
11.4
|
|
%
|
|
Gross profit
|
505
|
|
|
471
|
|
|
7.2
|
|
%
|
|
1,484
|
|
|
1,340
|
|
|
10.7
|
|
%
|
||||
|
Gross margin
|
39.2
|
%
|
|
39.4
|
%
|
|
(20
|
)
|
bp
|
|
38.8
|
%
|
|
39.1
|
%
|
|
(30
|
)
|
bp
|
||||
|
Total operating expenses
|
329
|
|
|
319
|
|
|
3.1
|
|
%
|
|
1,024
|
|
|
965
|
|
|
6.1
|
|
%
|
||||
|
Expense to revenue ratio
|
25.6
|
%
|
|
26.7
|
%
|
|
(110
|
)
|
bp
|
|
26.8
|
%
|
|
28.1
|
%
|
|
(130
|
)
|
bp
|
||||
|
Restructuring and realignment costs
|
11
|
|
|
9
|
|
|
22.2
|
|
%
|
|
37
|
|
|
32
|
|
|
15.6
|
|
%
|
||||
|
Sensus acquisition related charges
|
—
|
|
|
5
|
|
|
NM
|
|
|
|
—
|
|
|
19
|
|
|
NM
|
|
|
||||
|
Special charges
|
1
|
|
|
3
|
|
|
(66.7
|
)
|
%
|
|
8
|
|
|
8
|
|
|
—
|
|
%
|
||||
|
Operating expenses excluding restructuring and realignment costs, Sensus acquisition related costs and special charges
|
317
|
|
|
302
|
|
|
5.0
|
|
%
|
|
979
|
|
|
906
|
|
|
8.1
|
|
%
|
||||
|
Expense to revenue ratio
|
24.6
|
%
|
|
25.3
|
%
|
|
(70
|
)
|
bp
|
|
25.6
|
%
|
|
26.4
|
%
|
|
(80
|
)
|
bp
|
||||
|
Operating income
|
176
|
|
|
152
|
|
|
15.8
|
|
%
|
|
460
|
|
|
375
|
|
|
22.7
|
|
%
|
||||
|
Operating margin
|
13.7
|
%
|
|
12.7
|
%
|
|
100
|
|
bp
|
|
12.0
|
%
|
|
10.9
|
%
|
|
110
|
|
bp
|
||||
|
Interest and other non-operating expense, net
|
17
|
|
|
20
|
|
|
(15.0
|
)
|
%
|
|
54
|
|
|
57
|
|
|
(5.3
|
)
|
%
|
||||
|
Gain (loss) on sale of business
|
2
|
|
|
(1
|
)
|
|
(300.0
|
)
|
%
|
|
—
|
|
|
4
|
|
|
NM
|
|
|
||||
|
Income tax expense
|
31
|
|
|
27
|
|
|
14.8
|
|
%
|
|
82
|
|
|
62
|
|
|
32.3
|
|
%
|
||||
|
Tax rate
|
19.0
|
%
|
|
21.1
|
%
|
|
(210
|
)
|
bp
|
|
20.1
|
%
|
|
19.4
|
%
|
|
70
|
|
bp
|
||||
|
Net income
|
$
|
130
|
|
|
$
|
104
|
|
|
25.0
|
|
%
|
|
$
|
324
|
|
|
$
|
260
|
|
|
24.6
|
|
%
|
|
|
Water Infrastructure
|
|
Applied Water
|
|
Measurement & Control Solutions
|
|
Total Xylem
|
||||||||||||||||
|
(In millions)
|
$ Change
|
% Change
|
|
$ Change
|
% Change
|
|
$ Change
|
% Change
|
|
$ Change
|
% Change
|
||||||||||||
|
2017 Revenue
|
$
|
520
|
|
|
|
$
|
354
|
|
|
|
$
|
321
|
|
|
|
$
|
1,195
|
|
|
||||
|
Organic growth
|
39
|
|
7.5
|
%
|
|
30
|
|
8.5
|
%
|
|
25
|
|
7.8
|
%
|
|
94
|
|
7.9
|
%
|
||||
|
Acquisitions/Divestitures
|
—
|
|
—
|
%
|
|
(2
|
)
|
(0.6
|
)%
|
|
24
|
|
7.5
|
%
|
|
22
|
|
1.8
|
%
|
||||
|
Constant currency
|
39
|
|
7.5
|
%
|
|
28
|
|
7.9
|
%
|
|
49
|
|
15.3
|
%
|
|
116
|
|
9.7
|
%
|
||||
|
Foreign currency translation (a)
|
(18
|
)
|
(3.5
|
)%
|
|
(4
|
)
|
(1.1
|
)%
|
|
(2
|
)
|
(0.6
|
)%
|
|
(24
|
)
|
(2.0
|
)%
|
||||
|
Total change in revenue
|
21
|
|
4.0
|
%
|
|
24
|
|
6.8
|
%
|
|
47
|
|
14.6
|
%
|
|
92
|
|
7.7
|
%
|
||||
|
2018 Revenue
|
$
|
541
|
|
|
|
$
|
378
|
|
|
|
$
|
368
|
|
|
|
$
|
1,287
|
|
|
||||
|
(a)
|
Foreign currency translation impact for the quarter due to the weakening in value of various currencies against the U.S. Dollar, the largest being the Argentine Peso, the Swedish Krona and the Australian Dollar.
|
|
|
Water Infrastructure
|
|
Applied Water
|
|
Measurement & Control Solutions
|
|
Total Xylem
|
||||||||||||||||
|
(In millions)
|
$ Change
|
% Change
|
|
$ Change
|
% Change
|
|
$ Change
|
% Change
|
|
$ Change
|
% Change
|
||||||||||||
|
2017 Revenue
|
$
|
1,421
|
|
|
|
$
|
1,048
|
|
|
|
$
|
961
|
|
|
|
$
|
3,430
|
|
|
||||
|
Organic growth
|
126
|
|
8.9
|
%
|
|
76
|
|
7.3
|
%
|
|
67
|
|
7.0
|
%
|
|
269
|
|
7.8
|
%
|
||||
|
Acquisitions/Divestitures
|
—
|
|
—
|
%
|
|
(10
|
)
|
(1.0
|
)%
|
|
73
|
|
7.6
|
%
|
|
63
|
|
1.8
|
%
|
||||
|
Constant currency
|
126
|
|
8.9
|
%
|
|
66
|
|
6.3
|
%
|
|
140
|
|
14.6
|
%
|
|
332
|
|
9.7
|
%
|
||||
|
Foreign currency translation (a)
|
20
|
|
1.4
|
%
|
|
18
|
|
1.7
|
%
|
|
21
|
|
2.2
|
%
|
|
59
|
|
1.7
|
%
|
||||
|
Total change in revenue
|
146
|
|
10.3
|
%
|
|
84
|
|
8.0
|
%
|
|
161
|
|
16.8
|
%
|
|
391
|
|
11.4
|
%
|
||||
|
2018 Revenue
|
$
|
1,567
|
|
|
|
$
|
1,132
|
|
|
|
$
|
1,122
|
|
|
|
$
|
3,821
|
|
|
||||
|
(a)
|
Foreign currency translation impact for the nine months primarily due to strength in the value of the Euro, the British Pound, the Chinese Yuan and various other currencies against the U.S. Dollar. This impact was partially offset by the weakening in value of the Argentine Peso.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||||||||||
|
(In millions)
|
2018
|
|
2017
|
|
Change
|
|
2018
|
|
2017
|
|
Change
|
||||||||||||
|
Selling, general and administrative expenses ("SG&A")
|
$
|
279
|
|
|
$
|
270
|
|
|
3.3
|
|
%
|
|
$
|
868
|
|
|
$
|
812
|
|
|
6.9
|
|
%
|
|
SG&A as a % of revenue
|
21.7
|
%
|
|
22.6
|
%
|
|
(90
|
)
|
bp
|
|
22.7
|
%
|
|
23.7
|
%
|
|
(100
|
)
|
bp
|
||||
|
Research and development expenses ("R&D")
|
46
|
|
|
45
|
|
|
2.2
|
|
%
|
|
137
|
|
|
131
|
|
|
4.6
|
|
%
|
||||
|
R&D as a % of revenue
|
3.6
|
%
|
|
3.8
|
%
|
|
(20
|
)
|
bp
|
|
3.6
|
%
|
|
3.8
|
%
|
|
(20
|
)
|
bp
|
||||
|
Restructuring and asset impairment charges, net
|
4
|
|
|
4
|
|
|
—
|
|
%
|
|
19
|
|
|
22
|
|
|
(13.6
|
)
|
%
|
||||
|
Operating expenses
|
$
|
329
|
|
|
$
|
319
|
|
|
3.1
|
|
%
|
|
$
|
1,024
|
|
|
$
|
965
|
|
|
6.1
|
|
%
|
|
Expense to revenue ratio
|
25.6
|
%
|
|
26.7
|
%
|
|
(110
|
)
|
bp
|
|
26.8
|
%
|
|
28.1
|
%
|
|
(130
|
)
|
bp
|
||||
|
(in millions)
|
|
Water Infrastructure
|
|
Applied Water
|
|
Measurement & Control Solutions
|
|
Corporate
|
|
Total
|
||||||||||
|
Actions Commenced in 2018:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total expected costs
|
|
$
|
7
|
|
|
$
|
1
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
16
|
|
|
Costs incurred during Q1 2018
|
|
2
|
|
|
1
|
|
|
5
|
|
|
—
|
|
|
8
|
|
|||||
|
Costs incurred during Q2 2018
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
4
|
|
|||||
|
Costs incurred during Q3 2018
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
|
Total expected costs remaining
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Actions Commenced in 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total expected costs
|
|
$
|
18
|
|
|
$
|
12
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
33
|
|
|
Costs incurred during 2017
|
|
5
|
|
|
4
|
|
|
2
|
|
|
—
|
|
|
11
|
|
|||||
|
Costs incurred during Q1 2018
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
|
Costs incurred during Q2 2018
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
|
Costs incurred during Q3 2018
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
2
|
|
|||||
|
Total expected costs remaining
|
|
$
|
11
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Actions Commenced in 2016:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total expected costs
|
|
$
|
13
|
|
|
$
|
14
|
|
|
$
|
11
|
|
|
$
|
2
|
|
|
$
|
40
|
|
|
Costs incurred during 2016
|
|
11
|
|
|
10
|
|
|
6
|
|
|
2
|
|
|
29
|
|
|||||
|
Costs incurred during 2017
|
|
2
|
|
|
4
|
|
|
3
|
|
|
—
|
|
|
9
|
|
|||||
|
Costs incurred during Q1 2018
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
|
Costs incurred during Q2 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
|
Costs incurred during Q3 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
|
Total expected costs remaining
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||||||||||
|
(In millions)
|
2018
|
|
2017
|
|
Change
|
|
2018
|
|
2017
|
|
Change
|
||||||||||||
|
Water Infrastructure
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income
|
$
|
99
|
|
|
$
|
91
|
|
|
8.8
|
|
%
|
|
$
|
240
|
|
|
$
|
206
|
|
|
16.5
|
|
%
|
|
Operating margin
|
18.3
|
%
|
|
17.5
|
%
|
|
80
|
|
bp
|
|
15.3
|
%
|
|
14.5
|
%
|
|
80
|
|
bp
|
||||
|
Restructuring and realignment costs
|
5
|
|
|
3
|
|
|
66.7
|
|
%
|
|
15
|
|
|
12
|
|
|
25.0
|
|
%
|
||||
|
Adjusted operating income
|
$
|
104
|
|
|
$
|
94
|
|
|
10.6
|
|
%
|
|
$
|
255
|
|
|
$
|
218
|
|
|
17.0
|
|
%
|
|
Adjusted operating margin
|
19.2
|
%
|
|
18.1
|
%
|
|
110
|
|
bp
|
|
16.3
|
%
|
|
15.3
|
%
|
|
100
|
|
bp
|
||||
|
Applied Water
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income
|
$
|
59
|
|
|
$
|
50
|
|
|
18.0
|
|
%
|
|
$
|
170
|
|
|
$
|
134
|
|
|
26.9
|
|
%
|
|
Operating margin
|
15.6
|
%
|
|
14.1
|
%
|
|
150
|
|
bp
|
|
15.0
|
%
|
|
12.8
|
%
|
|
220
|
|
bp
|
||||
|
Restructuring and realignment costs
|
2
|
|
|
5
|
|
|
(60.0
|
)
|
%
|
|
7
|
|
|
14
|
|
|
(50.0
|
)
|
%
|
||||
|
Special charges
|
—
|
|
|
—
|
|
|
—
|
|
%
|
|
—
|
|
|
5
|
|
|
NM
|
|
|
||||
|
Adjusted operating income
|
$
|
61
|
|
|
$
|
55
|
|
|
10.9
|
|
%
|
|
$
|
177
|
|
|
$
|
153
|
|
|
15.7
|
|
%
|
|
Adjusted operating margin
|
16.1
|
%
|
|
15.5
|
%
|
|
60
|
|
bp
|
|
15.6
|
%
|
|
14.6
|
%
|
|
100
|
|
bp
|
||||
|
Measurement & Control Solutions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income
|
$
|
31
|
|
|
$
|
27
|
|
|
14.8
|
|
%
|
|
$
|
95
|
|
|
$
|
81
|
|
|
17.3
|
|
%
|
|
Operating margin
|
8.4
|
%
|
|
8.4
|
%
|
|
—
|
|
bp
|
|
8.5
|
%
|
|
8.4
|
%
|
|
10
|
|
bp
|
||||
|
Sensus acquisition related costs
|
—
|
|
|
4
|
|
|
NM
|
|
|
|
—
|
|
|
13
|
|
|
NM
|
|
|
||||
|
Restructuring and realignment costs
|
4
|
|
|
1
|
|
|
300.0
|
|
%
|
|
15
|
|
|
6
|
|
|
150.0
|
|
%
|
||||
|
Special charges
|
—
|
|
|
—
|
|
|
NM
|
|
|
|
3
|
|
|
—
|
|
|
NM
|
|
|
||||
|
Adjusted operating income
|
$
|
35
|
|
|
$
|
32
|
|
|
9.4
|
|
%
|
|
$
|
113
|
|
|
$
|
100
|
|
|
13.0
|
|
%
|
|
Adjusted operating margin
|
9.5
|
%
|
|
10.0
|
%
|
|
(50
|
)
|
bp
|
|
10.1
|
%
|
|
10.4
|
%
|
|
(30
|
)
|
bp
|
||||
|
Corporate and other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating loss
|
$
|
(13
|
)
|
|
$
|
(16
|
)
|
|
(18.8
|
)
|
%
|
|
$
|
(45
|
)
|
|
$
|
(46
|
)
|
|
(2.2
|
)
|
%
|
|
Sensus acquisition related costs
|
—
|
|
|
1
|
|
|
NM
|
|
|
|
—
|
|
|
6
|
|
|
NM
|
|
|
||||
|
Special charges
|
1
|
|
|
3
|
|
|
(66.7
|
)
|
%
|
|
5
|
|
|
3
|
|
|
66.7
|
|
%
|
||||
|
Adjusted operating loss
|
$
|
(12
|
)
|
|
$
|
(12
|
)
|
|
—
|
|
%
|
|
$
|
(40
|
)
|
|
$
|
(37
|
)
|
|
8.1
|
|
%
|
|
Total Xylem
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income
|
$
|
176
|
|
|
$
|
152
|
|
|
15.8
|
|
%
|
|
$
|
460
|
|
|
$
|
375
|
|
|
22.7
|
|
%
|
|
Operating margin
|
13.7
|
%
|
|
12.7
|
%
|
|
100
|
|
bp
|
|
12.0
|
%
|
|
10.9
|
%
|
|
110
|
|
bp
|
||||
|
Restructuring and realignment costs
|
11
|
|
|
9
|
|
|
22.2
|
|
%
|
|
37
|
|
|
32
|
|
|
15.6
|
|
%
|
||||
|
Sensus acquisition related costs
|
—
|
|
|
5
|
|
|
NM
|
|
|
|
—
|
|
|
19
|
|
|
NM
|
|
|
||||
|
Special charges
|
1
|
|
|
3
|
|
|
NM
|
|
|
|
8
|
|
|
8
|
|
|
—
|
|
%
|
||||
|
Adjusted operating income
|
$
|
188
|
|
|
$
|
169
|
|
|
11.2
|
|
%
|
|
$
|
505
|
|
|
$
|
434
|
|
|
16.4
|
|
%
|
|
Adjusted operating margin
|
14.6
|
%
|
|
14.1
|
%
|
|
50
|
|
bp
|
|
13.2
|
%
|
|
12.7
|
%
|
|
50
|
|
bp
|
||||
|
|
Nine Months Ended
|
||||||||||
|
|
September 30,
|
||||||||||
|
(In millions)
|
2018
|
|
2017
|
|
Change
|
||||||
|
Operating activities
|
$
|
388
|
|
|
$
|
379
|
|
|
$
|
9
|
|
|
Investing activities
|
(579
|
)
|
|
(122
|
)
|
|
(457
|
)
|
|||
|
Financing activities
|
195
|
|
|
(299
|
)
|
|
494
|
|
|||
|
Foreign exchange (a)
|
(14
|
)
|
|
17
|
|
|
(31
|
)
|
|||
|
Total
|
$
|
(10
|
)
|
|
$
|
(25
|
)
|
|
$
|
15
|
|
|
(a)
|
The impact is primarily due to the weakness of the Chinese Yuan, Argentine Peso and the Indian Rupee against the U.S. Dollar. These impacts were partially offset by the strengthening of the Euro against the U.S. Dollar.
|
|
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
PERIOD
|
|
TOTAL NUMBER OF SHARES PURCHASED
|
|
AVERAGE PRICE PAID PER SHARE (a)
|
|
TOTAL NUMBER OF SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PLANS OR PROGRAMS (b)
|
|
APPROXIMATE DOLLAR VALUE OF SHARES THAT MAY YET BE PURCHASED UNDER THE PLANS OR PROGRAMS (b)
|
|
7/1/18 - 7/31/18
|
|
—
|
|
—
|
|
—
|
|
$363
|
|
8/1/18 - 8/31/18
|
|
—
|
|
—
|
|
—
|
|
$363
|
|
9/1/18 - 9/30/18
|
|
—
|
|
—
|
|
—
|
|
$363
|
|
(a)
|
Average price paid per share is calculated on a settlement basis.
|
|
(b)
|
On August 24, 2015, our Board of Directors authorized the repurchase of up to
$500 million
in shares with no expiration date. The program's objective is to deploy our capital in a manner that benefits our shareholders and maintains our focus on growth. There were no shares repurchased under this program during the three months ended September 30, 2018. There are up to
$363 million
in shares that may still be purchased under this plan as of
September 30, 2018
.
|
|
Exhibit
Number
|
Description
|
Location
|
|
|
|
|
|
Fourth Amended and Restated Articles of Incorporation of Xylem Inc.
|
Incorporated by reference to Exhibit 3.1 of Xylem Inc.’s Form 8-K filed on May 15, 2017 (CIK No. 1524472, File No. 1-35229).
|
|
|
|
|
|
|
Fourth Amended and Restated By-laws of Xylem Inc.
|
Incorporated by reference to Exhibit 3.1 of Xylem Inc.’s Form 8-K filed on May 15, 2017 (CIK No. 1524472, File No. 1-35229).
|
|
|
|
|
|
|
Statement Re-Computation of Per Share Earnings
|
Information required to be presented in Exhibit 11 is provided under “Earnings Per Share” in Note 7 to the Condensed Consolidated Financial Statements in Part I, Item 1 “Condensed Consolidated Financial Statements” of this Report in accordance with the provisions of Financial Accounting Standards Board Accounting Standards Codification 260,
Earnings Per Share
.
|
|
|
|
|
|
|
Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
Filed herewith.
|
|
|
|
|
|
|
Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
Filed herewith.
|
|
|
|
|
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
This Exhibit is intended to be furnished in accordance with Regulation S-K Item 601(b) (32) (ii) and shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934 or incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as shall be expressly set forth by specific reference.
|
|
|
|
|
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
This Exhibit is intended to be furnished in accordance with Regulation S-K Item 601(b) (32) (ii) and shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934 or incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as shall be expressly set forth by specific reference.
|
|
|
|
|
|
|
101.0
|
The following materials from Xylem Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2018, formatted in XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Income Statements, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements of Cash Flows and (v) Notes to Condensed Consolidated Financial Statements
|
The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
XYLEM INC.
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
/s/ Paul Stellato
|
|
|
|
Paul A. Stellato
|
|
|
|
Vice President, Controller and Chief Accounting Officer
|
|
|
|
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
Customers
No Suppliers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|