Xylem trims annual revenue forecast after key product sales miss estimates

Xylem

31/10/2024 13:22

Oct 31 (Reuters) - Xylem  XYL.N  trimmed its annual
revenue forecast after reporting lower-than-expected sales for
some of its key equipment used for water treatment, dragging the
company's shares nearly 5% lower in premarket trade.
    The water technology firm now expects revenue of $8.50
billion for 2024, compared with a previous forecast of about
$8.55 billion. 
    Analysts had expected it to report revenue of $8.58 billion
this year, according to data compiled by LSEG.
    Sales from its water infrastructure unit, which offers
products such as water and wastewater pumps, stood at $623
million, falling short of analysts' estimate of $658.5 million.
    Xylem's applied water unit, which sells pumps, valves and
other equipment, brought in sales of $447 million, below
expectations of $451.2 million.
    Weakness in these segments weighed on the company's adjusted
earnings before interest, tax, depreciation and amortisation
(EBITDA). It reported adjusted EBITDA of $447 million, well
below expectations of $456 million, according to estimates
provided by Jefferies.
    Still, CEO Matthew Pine said demand for Xylem's products
remained resilient as total orders grew 8% to 2,201 in the
quarter ended Sept.30.  
    The company reported third-quarter revenue of $2.10 billion,
compared with analysts' estimate of $2.17 billion. 
    Analysts expect a full-year profit of $4.26 per share,
according to data compiled by LSEG.
    On an adjusted basis, Xylem posted a profit of $1.11 per
share for the quarter, in line with Street expectations as
weakness across its key segments was offset by slightly better
margins and favorable tax rates, according to Jefferies analyst
Saree Boroditsky.
    The company also narrowed its annual profit forecast to
between $4.22 and $4.24 per share, with the mid-point being the
same as its previous range of $4.18 to $4.28 per share. 

 (Reporting by Mariam Sunny in Bengaluru; Editing by Sonia
Cheema)
 ((Mariam.ESunny@thomsonreuters.com;))