賽莱默 (XYL) 2023 Q1 法說會逐字稿

Welcome to the Xylem First Quarter 2023 Earnings Conference Call. (Operator Instructions) I would now like to turn the call over to Andrea van der Berg, Vice President of Investor Relations. Please go ahead.

歡迎參加 Xylem 2023 年第一季度收益電話會議。 （操作員說明）我現在想把電話轉給投資者關係副總裁 Andrea van der Berg。請繼續。

Thank you, operator. Good morning, everyone, and welcome to Xylem's First Quarter 2023 Earnings Call. With me today are Chief Executive Officer, Patrick Decker; Chief Financial Officer, Sandy Rowland, and Chief Operating Officer, Matthew Pine. They will provide their perspective on Xylem's first quarter 2023 results and discuss the second quarter and full year outlook.

謝謝你，運營商。大家早上好，歡迎來到 Xylem 2023 年第一季度財報電話會議。今天和我在一起的是首席執行官 Patrick Decker；首席財務官 Sandy Rowland 和首席運營官 Matthew Pine。他們將提供他們對 Xylem 2023 年第一季度業績的看法，並討論第二季度和全年展望。

Following our prepared remarks, we will address questions related to the information covered on the call. I'll ask that you please keep to one question and a follow-up and then return to the queue.

在我們準備好的評論之後，我們將解決與電話中涵蓋的信息相關的問題。請繼續回答一個問題和一個後續問題，然後返回隊列。

As a reminder, this call and our webcast are accompanied by a slide presentation available in the Investors section of our website, www.xylem.com. A replay of today's call will be available until midnight, May 11. Please note the replay number +1 (800) 925-9354 or +1 (402) 220-5384. Additionally, the call will be available for playback via the Investors section of our website under the heading Investor Events. Please turn to Slide 2.

提醒一下，本次電話會議和我們的網絡廣播附有幻燈片演示，可在我們網站 www.xylem.com 的投資者部分獲取。今天電話會議的重播將持續到 5 月 11 日午夜。請注意重播號碼 +1 (800) 925-9354 或 +1 (402) 220-5384。此外，該電話會議將可通過我們網站的“投資者活動”標題下的“投資者”部分進行回放。請轉到幻燈片 2。

We will make some forward-looking statements on today's call, including references to future events or developments that we anticipate will or may occur in the future. These statements are subject to future risks and uncertainties, such as those factors described in Xylem's most recent annual report on Form 10-K and subsequent reports filed with the SEC.

我們將在今天的電話會議上發表一些前瞻性陳述，包括提及我們預計未來將要發生或可能發生的未來事件或發展。這些陳述受未來風險和不確定因素的影響，例如 Xylem 最近的 10-K 表格年度報告和隨後向美國證券交易委員會提交的報告中描述的那些因素。

Please note that the company undertakes no obligation to update any forward-looking statements publicly to reflect subsequent events or circumstances, and actual events or results could differ materially from those anticipated.

請注意，公司沒有義務公開更新任何前瞻性陳述以反映後續事件或情況，實際事件或結果可能與預期存在重大差異。

Please turn to Slide 3. We have provided you with a summary of our key performance metrics, including both GAAP and non-GAAP metrics. For purposes of today's call, all references will be on an organic and/or adjusted basis, unless otherwise indicated. Now GAAP financials have been reconciled for you and are included in the Appendix section of the presentation. Now please turn to Slide 4, and I will turn the call over to our CEO, Patrick Decker.

請轉到幻燈片 3。我們為您提供了關鍵績效指標的摘要，包括 GAAP 和非 GAAP 指標。就今天的電話會議而言，除非另有說明，否則所有參考資料都將基於有機和/或調整後的基礎。現在 GAAP 財務數據已經為您調整併包含在演示文稿的附錄部分中。現在請轉到幻燈片 4，我將把電話轉給我們的首席執行官 Patrick Decker。

Thanks, Andrea, and good morning, everyone. As we indicated in our press release this morning, the team delivered very strong operational performance in the first quarter, exceeding our expectations on revenue, margin and earnings per share.

謝謝，安德里亞，大家早上好。正如我們在今天上午的新聞稿中指出的那樣，該團隊在第一季度實現了非常強勁的運營業績，超出了我們對收入、利潤率和每股收益的預期。

Revenue grew 17% and Earnings per share was up 53%, and we delivered significant EBITDA margin expansion driven by volume growth on modest supply chain improvements, productivity and operating efficiency as well as a healthy price/cost mix.

收入增長 17%，每股收益增長 53%，我們實現了 EBITDA 利潤率的顯著增長，這是由於供應鏈適度改善、生產力和運營效率以及健康的價格/成本組合帶來的銷量增長推動的。

We saw backlog growth of 8% alongside double-digit organic revenue growth in utilities, industrial and commercial. And growth across all regions, most notably the U.S., Western Europe and key emerging markets such as Africa, Latin America and China. The team came into the year with good momentum and is capitalized on supply chain improvements and our competitive position to secure customer advantages and convert our backlog. The results reflect resilient underlying demand as evidenced by sequential orders growth in each segment, our very healthy $3.7 billion backlog and a book-to-bill ratio greater than 1 in each segment.

我們看到積壓訂單增長了 8%，同時公用事業、工業和商業的收入也實現了兩位數的有機增長。所有地區都有增長，尤其是美國、西歐和非洲、拉丁美洲和中國等主要新興市場。該團隊以良好的勢頭進入了這一年，並利用供應鏈的改進和我們的競爭地位來確保客戶優勢並轉換我們的積壓訂單。結果反映了潛在需求的彈性，每個細分市場的連續訂單增長、我們非常健康的 37 億美元積壓訂單以及每個細分市場的訂單出貨比都證明了這一點。

Given the team's operating discipline, the continued demand for our solutions and the intensifying long-term secular trends in water, we are confident about our momentum and growth outlook.

鑑於團隊的運營紀律、對我們解決方案的持續需求以及水資源長期長期趨勢的增強，我們對我們的發展勢頭和增長前景充滿信心。

So based on that, we're raising our full year organic revenue guidance to high single digits from mid-single digits and we're raising our EPS guide. Of course, we'll continue to monitor demand trends given some macro uncertainty in the broader economy, especially for the second half of the year but we remain confident in our position for the remainder of the year and beyond.

因此，基於此，我們將全年有機收入指引從中等個位數提高到高個位數，並且我們正在提高我們的 EPS 指南。當然，鑑於整體經濟存在一些宏觀不確定性，尤其是今年下半年，我們將繼續監測需求趨勢，但我們仍對今年剩餘時間及以後的狀況充滿信心。

Alongside this quarter's performance, we've also made great progress towards the combination of Xylem and Evoqua. Integration planning is well advanced and all necessary approval processes are moving ahead as planned. We continue to expect the transaction to close by midyear. We'll give more color on the Evoqua culmination in a moment as well as more detail on our outlook, end markets and regions. But first, let me now hand it over to Sandy to review the quarter's results.

除了本季度的表現，我們在 Xylem 和 Evoqua 的合併方面也取得了很大進展。整合規劃進展順利，所有必要的審批流程都在按計劃進行。我們繼續預計該交易將在年中完成。我們稍後會為 Evoqua 的高潮提供更多色彩，以及我們的前景、終端市場和地區的更多細節。但首先，讓我現在將其交給桑迪審查本季度的結果。

Thanks, Patrick. Please turn to Slide 5, and I'll cover our first quarter results. As Patrick highlighted, the team built on our momentum coming into 2023 with another healthy quarter of growth and margin expansion. Revenue grew 17% year-over-year, led by double-digit growth in the U.S. and Western Europe and high single-digit growth in emerging markets. In a moment, we'll look at detailed performance by segment, but in short, each segment grew double digits and exceeded our expectations.

謝謝，帕特里克。請轉到幻燈片 5，我將介紹我們第一季度的業績。正如帕特里克強調的那樣，該團隊在進入 2023 年的勢頭的基礎上又實現了健康的增長和利潤率擴張。收入同比增長 17%，這主要得益於美國和西歐的兩位數增長以及新興市場的高個位數增長。稍後，我們將按細分查看詳細的性能，但簡而言之，每個細分都增長了兩位數，超出了我們的預期。

Utilities, our largest end market, was up 23% with strength in the U.S. driven by continued chip supply improvements in, M&CS as well as price and robust OpEx demand in Water Infrastructure.

公用事業是我們最大的終端市場，上漲了 23%，其中美國的強勁增長得益於 M&CS 的芯片供應持續改善以及水利基礎設施的價格和強勁的 OpEx 需求。

Industrial, which is approximately 35% of revenues grew 13% with strong price realization and solid demand across all regions, particularly in Western Europe.

工業，約佔收入的 35%，增長了 13%，所有地區（尤其是西歐）的價格實現強勁且需求強勁。

Commercial, which is approximately 10% of our revenues, was up 16%, mainly due to continued backlog execution in the U.S.

約占我們收入 10% 的商業業務增長了 16%，這主要是由於在美國繼續執行積壓訂單。

And Residential, our smallest end market, with approximately 5% of revenues, was modestly down. Orders performance overall was better than expected and underlying demand remains resilient.

住宅是我們最小的終端市場，約佔收入的 5%，略有下降。總體訂單表現好於預期，潛在需求保持彈性。

M&CS was down 17% due to unusually high orders growth of 25% last year as a function of supply chain lead times. Water Infrastructure orders were up 1% and AWS was down 1%. EBITDA margin was 16.3%, up 210 basis points from the prior year on higher volumes and favorable price cost dynamics. Our EPS in the quarter was $0.72, up 53% year-over-year. Please turn to Slide 6, and I'll review the quarter's performance by segment in a bit more detail.

由於供應鏈交貨時間的影響，去年訂單異常高地增長了 25%，因此 M&CS 下跌了 17%。水基礎設施訂單增長 1%，AWS 下降 1%。 EBITDA 利潤率為 16.3%，比上年增長 210 個基點，原因是銷量增加和價格成本動態有利。我們本季度的每股收益為 0.72 美元，同比增長 53%。請轉到幻燈片 6，我將按細分更詳細地回顧本季度的表現。

M&CS revenue was up 32%, driven by better-than-expected recovery in chip supply. We saw double-digit growth, not only in metrology, but across our M&CS businesses, including test and measurement and pipeline assessment services. There was strong performance across all regions led by U.S. growth of over 40%. As mentioned, M&CS orders were down in the quarter, but up sequentially.

由於芯片供應好於預期的複蘇，M&CS 收入增長了 32%。我們看到了兩位數的增長，不僅在計量領域，而且在我們的 M&CS 業務中，包括測試和測量以及管道評估服務。在美國超過 40% 的增長帶動下，所有地區都表現強勁。如前所述，本季度 M&CS 訂單有所下降，但環比上升。

Demand for our AMI offerings remains healthy and our $2.1 billion backlog in M&CS is up 8% versus the prior year. EBITDA margin for the segment was up 690 basis points versus the prior year on strong incrementals. Robust volume conversion, price realization and productivity drove the expansion, more than offsetting inflation and unfavorable mix. And now let's turn to Slide 7, and I'll cover our Water Infrastructure business.

對我們的 AMI 產品的需求保持健康，我們 21 億美元的 M&CS 積壓訂單比上一年增長 8%。由於增長強勁，該部門的 EBITDA 利潤率較上年增長 690 個基點。強勁的銷量轉換、價格實現和生產率推動了擴張，不僅抵消了通貨膨脹和不利的組合。現在讓我們轉到幻燈片 7，我將介紹我們的水利基礎設施業務。

Water Infrastructure revenues were up 15% versus our guide of high single digits due to better price realization globally and stronger-than-expected demand in emerging markets. Growth exceeded our expectations across the portfolio with revenues up double digits in all regions and end markets. Geographically, the U.S. was up 22%, with strong price realization on utilities, OpEx demand and backlog execution. Western Europe grew 10% with robust demand in utilities and industrial. Emerging markets was also up low double digits, driven by strong OpEx demand in Latin America, Africa and China.

由於全球價格實現更好以及新興市場的需求強於預期，水利基礎設施收入比我們的高個位數指南增長了 15%。整個產品組合的增長超出了我們的預期，所有地區和終端市場的收入都增長了兩位數。從地域上看，美國上漲了 22%，公用事業、運營支出需求和積壓執行的價格實現強勁。西歐增長 10%，公用事業和工業需求旺盛。在拉丁美洲、非洲和中國強勁的 OpEx 需求的推動下，新興市場也出現了兩位數的低位增長。

Orders in the quarter were up sequentially and up 1% year-over-year versus double-digit growth last year. EBITDA margin for the segment was down 80 basis points, primarily due to unfavorable mix and strategic investments in digital and solutions selling, partially offset by favorable price cost dynamics. And please turn to Slide 8 for an overview of AWS.

本季度的訂單環比增長，同比增長 1%，而去年是兩位數的增長。該部門的 EBITDA 利潤率下降了 80 個基點，這主要是由於數字和解決方案銷售方面的不利組合和戰略投資，部分被有利的價格成本動態所抵消。請轉到幻燈片 8 了解 AWS 的概況。

Applied Water revenues grew 10% on strong price realization and improved supply chain. Geographically, Western Europe was up 17% due to backlog execution and healthy industrial and commercial demand. The U.S. was up 10%, driven by backlog execution and strong price realization, particularly in the commercial market. Emerging Markets was down low single digits, primarily due to lapping double-digit growth last year in the Middle East and Eastern Europe. And while orders were down 1% in the quarter, they were stronger than expected and notably, book-to-bill was greater than 1.

由於強勁的價格實現和改進的供應鏈，Applied Water 的收入增長了 10%。從地域上看，由於積壓執行和健康的工業和商業需求，西歐增長了 17%。在積壓執行和強勁的價格實現的推動下，美國增長了 10%，尤其是在商業市場。新興市場下降了低個位數，這主要是由於中東和東歐去年實現了兩位數的增長。雖然本季度訂單下降了 1%，但強於預期，值得注意的是，訂單出貨比大於 1。

Segment EBITDA margin was up 480 basis points in the quarter, driven by continued strong price realization and productivity, more than offsetting inflation. And now let's turn to Slide 9 for an overview of cash flows and the company's financial position.

在持續強勁的價格實現和生產率的推動下，該部門的 EBITDA 利潤率在本季度上升了 480 個基點，抵消了通貨膨脹。現在讓我們轉到幻燈片 9，了解現金流量和公司財務狀況的概況。

Our financial position remains robust as we exit the quarter with over $800 million in cash and available liquidity of $1.8 billion. Net debt-to-EBITDA leverage is 1x. Due to seasonality, free cash flow was negative in the quarter, but came in better than expected. While supply chain challenges are not yet behind us, we've made significant progress on working capital and we remain confident in our full year guidance of 100% conversion. Please turn to Slide 10, and I'll hand it back to Patrick.

我們以超過 8 億美元的現金和 18 億美元的可用流動資金退出本季度，我們的財務狀況依然穩健。淨債務對 EBITDA 的槓桿率為 1 倍。由於季節性，本季度自由現金流為負，但好於預期。雖然供應鏈挑戰尚未過去，但我們在營運資金方面取得了重大進展，並且我們對 100% 轉換的全年指導方針仍然充滿信心。請轉到幻燈片 10，我會把它交還給帕特里克。

Thanks, Sandy. Although it's still early in the year, we look forward with the confidence. We have strong momentum coming out of the first quarter, thanks to the team's continued operating discipline and resilient market demand. We'll be even better positioned for growth as we combine Xylem's market-leading portfolio with Evoqua's capabilities and presence in very attractive industrial end markets. And global trends are continuing to drive increasing investment in addressing critical water challenges, we're reinforcing the foundation of our long-term strategy.

謝謝，桑迪。雖然還處於年初，但我們滿懷信心地期待著。由於團隊持續的運營紀律和富有彈性的市場需求，我們在第一季度取得了強勁的勢頭。當我們將 Xylem 市場領先的產品組合與 Evoqua 在極具吸引力的工業終端市場的能力和影響力相結合時，我們將為增長做好更充分的準備。全球趨勢繼續推動增加對解決關鍵水資源挑戰的投資，我們正在鞏固我們長期戰略的基礎。

While we've been ensuring our team remains focused on meeting customer needs, winning in the marketplace and delivering on operational execution, we've also been preparing for our upcoming combination with Evoqua, which positions us even more favorably for the next phase of Xylem's growth.

在我們確保我們的團隊繼續專注於滿足客戶需求、贏得市場和交付運營執行的同時，我們也一直在為即將到來的與 Evoqua 的合併做準備，這使我們在 Xylem 的下一階段更有優勢生長。

As water risk rise in global importance, the combination of these 2 companies creates a transformative platform for solving customer's and communities' most critical water challenges at scale. As we said in January, the deal economics prove out on cost synergies alone. But more importantly, the combined company is positioned for very attractive growth, increasing recurring and resilient revenues and significant margin expansion opportunities in addition to the foundational cost synergies.

隨著水風險在全球重要性的上升，這兩家公司的合併創建了一個變革性平台，用於大規模解決客戶和社區最關鍵的水資源挑戰。正如我們在 1 月份所說，交易經濟學僅靠成本協同效應就證明了這一點。但更重要的是，除了基礎成本協同效應之外，合併後的公司有望實現非常有吸引力的增長，增加經常性和彈性收入以及顯著的利潤擴張機會。

On top of this, the combination is supported by a robust financial position and an even stronger balance sheet which preserves our optionality for the future. Since our January announcement of the transaction, an integration planning team comprising of senior staff from both companies has been working to set the company up for success. The integration is rooted in 4 simple principles: first, avoid distraction and deliver our 2023 plans; second, deliver on committed revenue and cost synergies; third, retain, motivate and develop key talent from each company; and lastly, bring the best of both cultures to the combined company.

最重要的是，合併得到穩健的財務狀況和更強大的資產負債表的支持，這為我們的未來保留了選擇權。自我們 1 月份宣布交易以來，由兩家公司高級職員組成的整合規劃團隊一直致力於為公司取得成功做好準備。整合植根於 4 個簡單的原則：首先，避免分心並實現我們的 2023 年計劃；第二，實現承諾的收入和成本協同效應；第三，保留、激勵和發展各公司的關鍵人才；最後，將兩種文化的精華帶入合併後的公司。

As we advance in the integration process, our confidence and excitement about the synergy potential of the combination continues to grow. And I'm sure many of you have seen Evoqua's second quarter results announced just 2 days ago. Based on their earnings release, it's clear both Xylem and Evoqua have strong momentum. We're remaining focused on serving our customers and delivering on our respective plans for the year.

隨著我們在整合過程中的推進，我們對合併的協同潛力的信心和興奮不斷增長。我相信你們中的許多人都看過 Evoqua 兩天前公佈的第二季度業績。根據他們發布的財報，很明顯 Xylem 和 Evoqua 都有強勁的勢頭。我們將繼續專注於為客戶提供服務並實現我們各自的年度計劃。

In addition to a solid quarter and confident outlook for the year, we also continue to see evidence of the intensifying secular trends at the foundation of our strategy. In March, the United Nations held its first water conference in over 40 years. It's one of many indicators of the global shift in attention to water and the focus on water's role in sustainable development. Xylem's delegation engaged with government leaders and development agencies from around the world, particularly on the role of technology and innovation and improving water security.

除了穩健的季度和充滿信心的年度前景外，我們還繼續看到我們戰略基礎上不斷加強的長期趨勢的證據。 3 月，聯合國召開了 40 多年來的首次水資源會議。這是全球對水的關注以及對水在可持續發展中的作用的關注轉變的眾多指標之一。 Xylem 的代表團與來自世界各地的政府領導人和發展機構進行了接觸，特別是在技術和創新的作用以及改善水安全方面。

Despite the different worlds of the private sector, government and NGOs often inhabit, sustainability is a powerful common language. For example, there was considerable discussion at the conference about water management and greenhouse gas emissions as water management drives roughly 10% of emissions globally. It's a particular focus in our work with customers, helping them reduce their emissions. And as you'll see in our 2022 sustainability report to be released this month, we've enabled customers to significantly reduce their CO2 footprint, achieving that specific Xylem 2025 sustainability goal well ahead of plan. That's a meaningful step, but there's a long way to go in decarbonizing the water sector more broadly.

儘管私營部門、政府和非政府組織經常身處不同的世界，但可持續性是一種強有力的共同語言。例如，會議上就水管理和溫室氣體排放進行了大量討論，因為水管理佔全球排放量的大約 10%。這是我們與客戶合作的一個特別重點，幫助他們減少排放。正如您將在本月發布的我們的 2022 年可持續發展報告中看到的那樣，我們幫助客戶顯著減少了他們的二氧化碳足跡，提前實現了特定的賽萊默 2025 年可持續發展目標。這是有意義的一步，但要更廣泛地實現水行業脫碳還有很長的路要走。

Fortunately, we are in the privileged position of helping customers achieve their net zero carbon goals by deploying more efficient technologies that reduce emissions and their operating costs, ultimately making water more affordable for our communities. That is work that we're both purpose-driven and commercially motivated to do.

幸運的是，我們處於優勢地位，可以通過部署更有效的技術來減少排放和運營成本，從而幫助客戶實現淨零碳目標，最終使我們的社區更負擔得起水。這是我們既有目標驅動又有商業動機的工作。

Our sustainability report also details the progress we've made across the full suite of our 2025 sustainability goals. And I invite each and every one of you to give it your full attention when it's released in the coming days. Now with that, I'll turn it over to Matthew to provide a view on our end market outlook.

我們的可持續發展報告還詳細介紹了我們在全套 2025 年可持續發展目標方面取得的進展。當它在未來幾天發佈時，我邀請你們每一個人都給予全神貫注。現在，我將把它交給馬修，讓他對我們的終端市場前景發表看法。

Thank you, Patrick. Before I dive into the end market outlook, I want to congratulate the team on a great quarter. We exceeded our expectations across the board and made great progress on productivity initiatives, leading to healthy margin expansion. Overall, we are well positioned to continue building on this momentum through the rest of the year.

謝謝你，帕特里克。在深入探討最終市場前景之前，我想祝賀團隊取得了出色的成績。我們全面超出了我們的預期，並在生產力計劃方面取得了巨大進展，從而實現了健康的利潤增長。總體而言，我們已準備好在今年餘下的時間裡繼續保持這一勢頭。

Looking ahead, we have taken a balanced approach in our outlook given the dynamics of the macroeconomic environment. Our backlogs are strong and underlying demand in our largest end markets continues to be resilient, providing confidence to raise our 2023 guide. That said, we are closely monitoring leading indicators in some of our more cyclical businesses, particularly in developed markets. We expect continued steady demand in emerging markets and are optimistic about a gradual recovery in China through the rest of the year.

展望未來，鑑於宏觀經濟環境的動態，我們在展望中採取了平衡的方法。我們的積壓訂單量很大，我們最大的終端市場的潛在需求繼續保持彈性，為提高我們的 2023 年指南提供了信心。也就是說，我們正在密切關註一些更具週期性的業務的領先指標，尤其是在發達市場。我們預計新興市場的需求將持續穩定，並對中國在今年餘下時間逐步復甦持樂觀態度。

Utilities, which makes up the largest end market continues to be healthy, and we now expect growth in low teens in 2023, up from high single digits. On the wastewater side, we expect high single-digit growth up from mid-single-digit growth. We expect OpEx strength in developed markets as well as continued CapEx spend in emerging markets will result in steady global demand.

構成最大終端市場的公用事業繼續保持健康，我們現在預計 2023 年將以低個位數增長，高於高個位數。在廢水方面，我們預計將實現高個位數增長，高於中等個位數增長。我們預計發達市場的運營支出強勁以及新興市場的持續資本支出支出將導致全球需求穩定。

On the clean water side, we anticipate growth of high teens up from low teens. This increase in our outlook is driven by continued robust demand for our AMI solutions and earlier improvements in chip supply through 2023 as seen in quarter 1, allowing for backlog execution.

在清潔水方面，我們預計高青少年的增長將從低青少年上升。我們對 AMI 解決方案的持續強勁需求以及第一季度到 2023 年芯片供應的早期改善推動了我們前景的增長，從而允許執行積壓。

We continue to foresee healthy momentum in our test and measurement and our pipeline assessment service businesses due to increasing focus on infrastructure and climate challenges. We are also seeing early benefits from the unification of our commercial team in the Americas. The team has made great progress in solution selling to our utility customers, bringing the best of Xylem's offerings to bear solving our customers' highest value challenges.

由於對基礎設施和氣候挑戰的日益關注，我們繼續預見我們的測試和測量以及我們的管道評估服務業務的良好勢頭。我們也看到了我們在美洲的商業團隊的統一所帶來的早期好處。該團隊在向我們的公用事業客戶銷售解決方案方面取得了長足進步，利用 Xylem 的最佳產品來解決我們客戶面臨的最高價值挑戰。

Looking at the industrial end market, we expect to grow mid-single digits on steady demand for solutions globally. While U.S. industrial production estimates point to potential softening in the back half of 2023, we expect that to be offset by growth in emerging markets and were supported by our backlog. In addition, our dewatering business continues to see strong demand from mining in emerging markets, particularly in Latin America and is benefiting from strategic investments we've made in our fleet.

放眼工業終端市場，我們預計將在全球對解決方案的穩定需求下實現中個位數增長。儘管美國工業生產預估顯示 2023 年下半年可能出現疲軟，但我們預計這將被新興市場的增長所抵消，並得到我們積壓訂單的支持。此外，我們的脫水業務繼續看到新興市場（尤其是拉丁美洲）採礦業的強勁需求，並且受益於我們對船隊進行的戰略投資。

Moving on to commercial. Given Q1 outperformance, we now expect mid-single-digit growth, up from low single digits. We anticipate continued growth driven by solid replacement business and backlog execution, partially offset by new construction. We would expect the moderation to emerge in the second half results and are monitoring the ABI institutional index and other indicators closely.

繼續商業化。鑑於第一季度的出色表現，我們現在預計將實現中個位數增長，高於低個位數。我們預計穩固的替換業務和積壓執行將推動持續增長，部分被新建築所抵消。我們預計下半年業績會出現放緩，並密切關注 ABI 機構指數和其他指標。

In residential, our smallest end market, we continue to expect a low single-digit decline due to normalizing demand in the U.S., partially offset by continued resilience in emerging markets. Overall, we feel confident about the resiliency of demand given our backlog and healthy orders momentum. Now I'll turn it over to Sandy to walk you through our updated guidance.

在我們最小的終端市場住宅市場，由於美國需求正常化，我們繼續預計將出現較低的個位數下降，部分被新興市場的持續彈性所抵消。總體而言，鑑於我們的積壓訂單和健康的訂單勢頭，我們對需求的彈性充滿信心。現在我將把它交給桑迪來引導您完成我們更新的指南。

Thank you, Matthew. Turning to Slide 12. As a reminder, our guidance is on a stand-alone basis and excludes the combination with Evoqua. As Patrick mentioned, we are increasing our full year guidance for organic revenue growth and adjusted EPS. We are raising our full year organic revenue growth to 8% to 9%, up from 4% to 6%. This increase is driven primarily by stronger price realization and earlier-than-expected supply chain improvements in the year.

謝謝你，馬修。轉到幻燈片 12。提醒一下，我們的指南是獨立的，不包括與 Evoqua 的組合。正如帕特里克所提到的，我們正在增加對有機收入增長和調整後每股收益的全年指導。我們將全年有機收入增長率從 4% 提高到 6%，提高到 8% 到 9%。這一增長主要是由於今年價格實現更強勁以及供應鏈改善早於預期。

In addition, we are lifting our full year adjusted EPS guidance to $3.15 to $3.35, up from $3 to $3.25. The revised guidance breaks down by segment as follows: high teens growth in M&CS versus previous guidance of low teens, high single-digit growth in Water Infrastructure, up from mid-single-digit growth with solid growth in both wastewater utilities and industrial and mid-single-digit growth in Applied Water, up from low single digits with growth in industrial and commercial, partially offset by residential.

此外，我們將全年調整後每股收益指引從 3 美元上調至 3.25 美元至 3.15 美元至 3.35 美元。修訂後的指導按細分市場細分如下：M&CS 的高青少年增長與之前低青少年的指導相比，水利基礎設施的高個位數增長，高於中等個位數增長，污水公用事業和工業和中等行業均穩步增長-Applied Water 的個位數增長，高於工業和商業的低個位數增長，部分被住宅抵消。

For 2023, our EBITDA guidance is 17.5% to 18%. And as mentioned, this yields an adjusted EPS range of $3.15 to $3.35. We still expect free cash flow conversion to be 100% of net income. And we've also provided you with a number of other full year assumptions on the slide to supplement your model.

對於 2023 年，我們的 EBITDA 指引為 17.5% 至 18%。如前所述，這產生了 3.15 美元至 3.35 美元的調整後每股收益範圍。我們仍然預計自由現金流轉換為淨收入的 100%。我們還在幻燈片上為您提供了許多其他全年假設，以補充您的模型。

And now drilling down on the second quarter, we anticipate total company revenues will be in the range of 10% to 11% organic growth. By segment, we expect high teens growth for M&CS and high single-digit growth in both Water Infrastructure and Applied Water. We expect second quarter EBITDA margin to be in the range of 17.5% to 18%, which represents over 100 basis points of improvement versus the prior year, driven by higher volumes and continued price realization and productivity gains. And with that, turn to Slide 13, and I'll turn the call back over to Patrick for closing comments.

現在深入研究第二季度，我們預計公司總收入將實現 10% 至 11% 的有機增長。按細分市場劃分，我們預計 M&CS 將實現高青少年增長，水基礎設施和應用水務將實現高個位數增長。我們預計第二季度 EBITDA 利潤率將在 17.5% 至 18% 之間，與上年同期相比提高了 100 多個基點，這得益於銷量增加、價格持續實現和生產率提高。然後，轉到幻燈片 13，我會將電話轉回給 Patrick 以徵求結束意見。

Thanks, Sandy. I'm very proud of the team's performance demonstrating continuing dedication to serving our customers and communities and delivering very strong results. Looking ahead, we're focused on continuing that momentum while also executing a successful integration of Evoqua once the deal closes. We look forward to updating you on that combination in our next earnings call when I anticipate we will be presenting the performance, outlook and opportunity of our combined company. Now operator, I'll turn the call back over to you for questions.

謝謝，桑迪。我為團隊的表現感到非常自豪，證明他們持續致力於為我們的客戶和社區服務，並取得了非常可觀的成果。展望未來，我們專注於保持這種勢頭，同時在交易完成後成功整合 Evoqua。我們期待在下一次財報電話會議上向您介紹合併後的最新情況，屆時我預計我們將介紹合併後公司的業績、前景和機遇。現在接線員，我會把電話轉回給你提問。

(Operator Instructions) Our first question will come from Deane Dray with RBC Capital Markets.

（操作員說明）我們的第一個問題將來自 RBC 資本市場的 Deane Dray。

These are impressive numbers on organic revenue growth and the margins, especially total company margins but that takes me to the first question on Water Infrastructure. And I know this is seasonally the lowest margin for that segment. But you called out 3 factors: mix, timing of projects, and some investments like in digital. And just hoping if you could size these and maybe give some additional color.

這些關於有機收入增長和利潤率的數字令人印象深刻，尤其是公司總利潤率，但這讓我想到了關於水利基礎設施的第一個問題。而且我知道這是該細分市場的季節性最低利潤率。但你指出了 3 個因素：組合、項目時間安排以及一些投資，例如數字投資。只是希望你能調整這些尺寸，也許還能給一些額外的顏色。

Yes, Deane, great question. I think you highlighted some really important points. First of all, Q1 is typically our lowest margin quarter for our Water Infrastructure business. On an EBITDA basis, we were down about 80 bps this quarter. It's really essentially all in gross profit, and it really comes down to 2 or 3 items. One, just product mix, a little bit of geographic mix. And we had some larger scale projects this quarter that typically carries modestly lower margins. And then we have been continuing to make some investments in this segment. It talks to the -- our optimism about its long-term prospects. And those investments have been really focused on increasing our digital selling and solution selling capabilities, and we're seeing proof of that investment come through in our orders momentum and growth.

是的，迪恩，好問題。我認為您強調了一些非常重要的觀點。首先，第一季度通常是我們水利基礎設施業務利潤率最低的季度。在 EBITDA 的基礎上，我們本季度下降了約 80 個基點。它實際上基本上都是毛利潤，而且實際上歸結為 2 或 3 個項目。第一，只是產品組合，一點點地域組合。本季度我們有一些規模較大的項目，通常利潤率會略低。然後我們一直在繼續在這個領域進行一些投資。它與我們對其長期前景的樂觀態度有關。這些投資真正集中在提高我們的數字銷售和解決方案銷售能力上，我們看到這些投資體現在我們的訂單勢頭和增長中。

And I think, Deane, when you look forward to the rest of the year, we think that Water Infrastructure margins are going to rebound in Q2 and the rest of the year, in line with our typical seasonality.

我認為，迪恩，當你期待今年餘下的時間時，我們認為水利基礎設施的利潤率將在第二季度和今年餘下時間反彈，這與我們典型的季節性一致。

All right. That was exactly what I was looking for.

好的。這正是我要找的。

Deane, I just offer -- hey Deane I would just offer a -- this is Patrick, that margin improvement is also supported by what we have in backlog. So these orders that are being won based on these investments support that continued improvement in margins.

迪恩，我只是提供 - 嘿迪恩，我只是提供一個 - 這是帕特里克，利潤率的提高也得到了我們積壓訂單的支持。因此，基於這些投資贏得的這些訂單支持利潤率的持續提高。

That's great. And that kind of takes me to the next question on M&CS and the chip supply. And Patrick, I remember when the spur surface, and it was everywhere that everyone was getting these chip supply shortages and it just accentuate the point that Xylem is from a smart water standpoint, so dependent on semiconductors. But at the time when it was most uncertain, you all said it would be a gradual expectations for a gradual improvement in the supply, and that's exactly how it's been playing out. So where you stand today, how does the backlog look in terms of like past due of MC&S chips and is just -- should we expect this consistent kind of gradual improvement for the balance of the year?

那太棒了。這讓我想到了下一個關於 M&CS 和芯片供應的問題。帕特里克，我記得當支線浮出水面時，到處都是每個人都遇到這些芯片供應短缺，這只是強調了賽萊默從智能水的角度來看非常依賴半導體這一點。但是在最不確定的時候，你們都說是逐步的預期，逐步改善供給，結果就是這樣。那麼你今天所處的位置，從 MC&S 芯片的逾期來看，積壓情況如何？我們是否應該期待今年餘下時間的這種持續逐步改善？

Sure. Thanks for the question, Deane. I'll hand it over to Matthew to give more color on it.

當然。謝謝你的問題，迪恩。我會把它交給 Matthew 給它更多的顏色。

Yes, we had, for sure, better-than-expected results in Q1 in metrology. The chip supply continues to be lumpy, but it is continuing to move at a steady incremental pace to your point. Our backlog continues to be 30% past due. That was last quarter as well because of the continued orders momentum that we've seen in this business up 8% in metrology, in M&CS. And so we're going to continue to expect modest improvement, and we're still managing the variation in supply.

是的，我們在第一季度的計量結果肯定好於預期。芯片供應繼續不穩定，但它繼續以穩定的增量速度移動到你的觀點。我們的積壓訂單仍然逾期 30%。這也是上個季度的原因，因為我們在該業務中看到的持續訂單勢頭在 M&CS 的計量學領域增長了 8%。因此，我們將繼續期待適度的改善，我們仍在管理供應的變化。

And the one thing I would point out, as a lot of you probably remember, is the book-to-bill for automotive and industrial chips is still plus 1. So we're still kind of working through this problem where on the consumer side, you're seeing a little bit more relief. So we're just going to be steady as it goes over the coming quarters, and we'll see those modest improvements. And with those modest improvements, we've taken up our guide from low teens to high teens for 2023 for M&CS.

我要指出的一件事是，正如你們中的很多人可能還記得的那樣，汽車和工業芯片的訂單出貨比仍然是正數。所以我們仍在努力解決消費者方面的這個問題，你會看到更多的安慰。因此，在接下來的幾個季度中，我們將保持穩定，我們將看到這些適度的改進。通過這些適度的改進，我們已經採用了 2023 年 M&CS 從低青少年到高青少年的指南。

And I would just offer that as well that, one, we've continued to hold on to all of our deals in backlog. There have been no cancellations. And so that's continued to be a good sign as we deliver -- as we say we're going to deliver. And then certainly, two, as Matthew pointed out, continue to see really strong demand and market wins despite the chip supply challenges. So I think the confidence has grown over the course of the past year more.

而且我也只想提供一點，一個，我們繼續堅持我們所有積壓的交易。沒有取消。因此，這在我們交付時仍然是一個好兆頭——正如我們所說的那樣，我們將交付。然後當然，正如 Matthew 指出的那樣，儘管面臨芯片供應挑戰，但仍然有兩個市場繼續看到非常強勁的需求和市場胜利。因此，我認為信心在過去一年中增長了更多。

Our next question will come from Nathan Jones with Stifel.

我們的下一個問題將來自 Stifel 的 Nathan Jones。

I'm going to follow up on the M&CS guidance, chip supply, et cetera, et cetera. I mean, the guidance going from mid-teens to high teens pretty much just considers the outperformance in the first quarter. If you model it out, the dollars of revenue each quarter doesn't really change for the remaining 3 quarters. I know you guys have talked about better chip supply, you have product redesigns to use more available chips that come in the back half. Is there still a little bit of maybe overly conservative approach to the guidance for M&CS, just given the improvements that you're seeing plus these product redesigns that start coming out, I think, probably in the third quarter?

我將跟進 M&CS 指南、芯片供應等。我的意思是，從十幾歲到十幾歲的指導幾乎只考慮了第一季度的出色表現。如果您對其進行建模，則每個季度的收入美元在剩餘的 3 個季度中並沒有真正改變。我知道你們討論過更好的芯片供應，你們對產品進行了重新設計，以使用後半部分提供的更多可用芯片。考慮到您所看到的改進以及我認為可能在第三季度開始出現的這些產品重新設計，對 M&CS 的指導是否還有一點可能過於保守？

Yes, Nate, let me give that a shot. First of all, we're really pleased with what we saw from a delivery perspective in Q1, and we've got out of the gate with a fast start this year. When we look at the next quarter for M&CS, we actually think it looks very similar to what we experienced in Q1. So good strong business in metrology, but also the other businesses that we have in analytics and assessment services, when it all comes together, Q1 and Q2 look pretty similar. And then when we look at the back half of the year, we've got embedded in our guide a modest ramp up in the back half. And we've got to continue to monitor the chip supply situation. It is not perfect operationally yet.

是的，內特，讓我試一試。首先，我們對第一季度從交付角度所看到的情況感到非常滿意，並且我們今年開局很快。當我們展望下一個季度的 M&CS 時，我們實際上認為它看起來與我們在第一季度所經歷的非常相似。如此強大的計量業務，以及我們在分析和評估服務方面的其他業務，當所有這些結合在一起時，第一季度和第二季度看起來非常相似。然後當我們回顧今年下半年時，我們已經在我們的指南中嵌入了下半年的適度增長。我們必須繼續監控芯片供應情況。它在操作上還不完善。

Yes. I would just add. We're just -- we're trying to be prudent with the guide to Sandy's point in the back half, we still don't have good visibility. We do -- I call it the daily miracle. We're managing decommits and push outs and come in of chips, and we're just trying to manage the guide and be prudent in the second half.

是的。我只想補充。我們只是 - 我們正在努力謹慎使用後半部分桑迪點的指南，我們仍然沒有很好的能見度。我們做到了——我稱之為每日奇蹟。我們正在管理退役和推出籌碼，我們只是在努力管理指南並在下半場保持謹慎。

Okay. That makes sense. Maybe just following up on the 30% of backlog that's past due, I anticipate that at some point here, the chip supply is going to get significantly better, and you could probably manufacture more than your customers are going to be ready to take with the backlog likely -- sorry, bottleneck likely becoming utility labor to go and install these things. How do you think about the progression of that 30% past due working that down to whatever a normal level of past due is and actually burning some of this backlog down '24 or '25 as we go along.

好的。這就說得通了。也許只是跟進 30% 的積壓訂單，我預計在某個時候，芯片供應會明顯好轉，你可能會製造比你的客戶準備接受的更多積壓可能——抱歉，瓶頸可能成為公用事業人員去安裝這些東西。您如何看待逾期 30% 的進展，將其降低到任何正常的逾期水平，並在我們進行的過程中實際燃燒掉 24 或 25 年的一些積壓工作。

Yes. We'll progressively work the backlog down as the chips became to be more fluid. The bottleneck is not going to be -- well, the bottleneck now is chip supply, but the next bottleneck will not be our capacity, to your point, it's going to be really working with our customers to make sure they have the deployment capacity. And that's something we're planning on right now and getting ahead and looking out and projecting with our customers through really the end of 2024 in lining up that capacity for deployment. So we're locked up with our customers to make sure that we've got that set up as the chip supply continues to improve, that the deployment capacity does not become a throttle and a bottleneck as we move through the end of the -- through 2023 and through 2024.

是的。隨著籌碼變得更加流暢，我們將逐步減少積壓。瓶頸不會是——嗯，現在的瓶頸是芯片供應，但下一個瓶頸不會是我們的能力，就你的觀點而言，它將真正與我們的客戶合作，以確保他們擁有部署能力。這就是我們現在正在計劃的事情，並在 2024 年底之前與我們的客戶一起展望和預測，以排列部署能力。因此，我們與客戶保持密切聯繫，以確保隨著芯片供應的不斷改善，我們已經做好了準備，部署能力不會成為阻礙和瓶頸，因為我們會走到最後——到 2023 年和 2024 年。

I would offer up, Nate, as well. As you probably know, Nate, the nature of these deployments at a utility level, these are years in the development and the approval process. And the main concern on the part of utilities is that once they begin to get chip supply, but there's a steady installation progress for them so that there's no concerns by regulators as to whether or not an approved deal was actually ever going to happen. So as long as they're showing steady improvement and deployment, the labor issue will not be a major bottleneck in terms of a major slowdown. And so there'll be a good steady progression.

我也願意，Nate。正如您可能知道的那樣，Nate，這些部署在公用事業級別的性質，這些都是在開發和批准過程中的多年。公用事業方面的主要擔憂是，一旦他們開始獲得芯片供應，但他們的安裝進度穩定，因此監管機構不會擔心批准的交易是否真的會發生。因此，只要他們表現出穩步的改進和部署，勞動力問題就不會成為經濟放緩的主要瓶頸。因此會有一個良好的穩定進展。

Our next question will come from Joe Giordano with TD Cowen.

我們的下一個問題將來自 TD Cowen 的 Joe Giordano。

So I guess going through this earnings season, we've heard a lot of companies start talking about changing in customer buying patterns a little bit and maybe April trends being worse than what the average of the first quarter was. So just curious if you have anything to say there. I'm probably talking more on like the industrial side than on the utility side there.

所以我想在這個財報季中，我們已經聽到很多公司開始談論客戶購買模式的變化，也許 4 月份的趨勢比第一季度的平均水平更糟糕。所以很好奇你是否有什麼要說的。我可能更多地談論工業方面而不是公用事業方面。

Yes. I mean, Joe, we saw nothing surprising coming out of our April results. Obviously, we're in the process of closing the books there for that month, but nothing has jumped out to be out of the ordinary order change from what we saw in Q1.

是的。我的意思是，喬，我們沒有看到我們 4 月份的結果令人驚訝。顯然，我們正在關閉那個月的賬簿，但與我們在第一季度看到的情況相比，沒有任何異常的訂單變化。

And Joe, I think it's also safe to say that one of the things that we track, not only in industrial but across the entire portfolio is our bidding pipeline and that bidding pipeline continues to be very healthy and growing consistently. So another good indicator. Matthew, you can probably talk to our channel partners and what you're hearing there in terms of the health of their inventory levels.

喬，我認為可以肯定地說，我們跟踪的事情之一，不僅在工業領域，而且在整個投資組合中，都是我們的投標管道，而且投標管道繼續非常健康並且持續增長。所以另一個很好的指標。馬修，您可能可以與我們的渠道合作夥伴談談您在那裡聽到的關於他們庫存水平健康狀況的信息。

So from a channel inventory point of view, we do have really good visibility because we have strong relationship with our channel partners. And overall, I'd say levels are healthy, and they're not sitting on excess inventory. On the industrial front, there's not a lot of inventory that's configured to order, engineer to order, but we have seen good demand in that area, specifically in emerging markets in the first quarter was really strong and resilient in industrial. Utilities, specifically in wastewater OpEx, that's been really healthy and been really resilient through the past 18 months given our vertical integration in that segment.

所以從渠道庫存的角度來看，我們確實有很好的知名度，因為我們與渠道合作夥伴有著牢固的關係。總的來說，我會說水平是健康的，而且它們沒有庫存過剩。在工業方面，沒有多少庫存是按訂單配置的，按訂單設計的，但我們看到該領域的需求良好，特別是在第一季度的新興市場，工業領域的需求非常強勁且富有彈性。鑑於我們在該領域的垂直整合，公用事業，特別是在廢水運營支出方面，在過去 18 個月中一直非常健康並且非常有彈性。

On the commercial front, we're still not back to 2019 levels given the continued supply challenges and constraints that we feel in the commercial part of our business. And then lastly, which is resi is the smallest portion of our business. It's well stock, and we're seeing a little bit of moderation there.

在商業方面，鑑於我們在業務的商業部分感受到持續的供應挑戰和限制，我們仍未回到 2019 年的水平。最後，resi 是我們業務中最小的部分。它存貨充足，我們看到那裡有點節制。

Fair enough. And then Patrick, on Evoqua, I know you can't say a whole lot, but is there anything you can -- any updates at all on timing or like what's been -- what are you currently waiting on? And then what are you -- what can you say about what you've done internally like to kind of prepare for this coming in? I know you're not just sitting around waiting for approval. So what -- can you maybe give us a little intent what -- how you're getting the organization prep for this?

很公平。然後是帕特里克，在 Evoqua 上，我知道你不能說太多，但有什麼你可以說的——任何關於時間的更新，或者像過去一樣——你目前還在等什麼？然後你是什麼——你能說說你在內部做了什麼來為這次進來做準備嗎？我知道你不只是坐等批准。那麼 - 你能不能給我們一點意圖 - 你如何讓組織為此做好準備？

Sure. Yes. No, thanks, Joe. So just on the transaction itself, as I said in our comments, I mean, really pleased with the progress. I'm proud of the team. I mean there's a ton of work that goes into this from both companies while people doing their day jobs. So a lot of great progress there. There were several countries, obviously, beyond the U.S. that required approval. We've achieved clearance in all of those countries. The only remaining country is China. In China, our filing has been accepted for what we call the short-form review, which typically takes no more than 30 days. And we're moving well through that and don't expect any issues there. And so we've got our shareholder vote coming up on May 11, both set of shareholders. So we will get through that next week. And again, for all those reasons, we continue to expect to close this by midyear. So that's on the transaction closure.

當然。是的。不，謝謝，喬。所以就交易本身而言，正如我在我們的評論中所說，我的意思是，我對進展感到非常滿意。我為球隊感到驕傲。我的意思是，當人們在做日常工作時，兩家公司都為此做了大量工作。那裡取得了很大的進步。顯然，除了美國之外，還有幾個國家需要批准。我們已經在所有這些國家/地區獲得許可。唯一剩下的國家是中國。在中國，我們的申請已被接受為所謂的簡式審查，通常不超過 30 天。我們進展順利，預計不會出現任何問題。因此，我們的股東投票將於 5 月 11 日舉行，雙方股東都將投票。所以我們將在下週解決這個問題。同樣，出於所有這些原因，我們繼續期望在年中之前完成這項工作。這就是交易關閉。

You're right. We've got a dedicated integration planning team. I've spent a considerable amount of time with Ron Keating, their CEO and his leadership team. Matthew has spent considerable amount of time with them as well. We've had many, many integration planning meetings. And on the cost side, clear line of sight to what we committed to before, that being $140 million in 3 years and very simple, straightforward areas. I didn't say simple is easy, but they're simple. We're not going after rabbits here. We're going after big items and deliver those as quickly as possible.

你說得對。我們有一個專門的整合規劃團隊。我花了相當多的時間與 Ron Keating、他們的首席執行官和他的領導團隊在一起。 Matthew 也花了很多時間和他們在一起。我們召開了很多很多整合規劃會議。在成本方面，我們之前承諾的目標清晰可見，即 3 年內 1.4 億美元和非常簡單、直接的領域。我沒有說簡單很容易，但它們很簡單。我們不是在這裡追兔子。我們正在尋找大件物品並儘快交付。

And again, what we've always been most excited about is the growth synergy. And so looking there, you're right, they're -- we are somewhat limited on how much detail we can get into until we have final regulatory approvals from a competitive standpoint. But as the teams have worked together, we're even more excited about the top line growth synergies that are out there. As we've mentioned before, we're most excited about the opportunity to deepen our penetration within utilities of the combined portfolio to expand both their international -- their integrated services and solutions business on the industrial side internationally, but also a number of their treatment products that we can take through our channels internationally.

再一次，我們一直最興奮的是增長協同效應。所以看那裡，你是對的，他們是 - 在我們從競爭的角度獲得最終監管批准之前，我們可以了解多少細節。但隨著團隊的共同努力，我們對那裡的頂線增長協同效應更加興奮。正如我們之前提到的，我們很高興有機會加深我們在合併後的投資組合的公用事業領域的滲透，以擴大他們的國際——他們在國際工業方面的綜合服務和解決方案業務，還有他們的一些我們可以通過我們的國際渠道獲取的治療產品。

We both have efforts going on around digital services and solutions and opportunities to leverage our combined platform there to serve needs for different customer sets around the world. And then there's going to be opportunity in synergy in the areas of R&D and innovation as well as some of our portfolio enhancements in that area.

我們都在圍繞數字服務和解決方案做出努力，並有機會利用我們在那裡的聯合平台來滿足全球不同客戶群的需求。然後在研發和創新領域以及我們在該領域的一些產品組合增強方面將有機會發揮協同作用。

Obviously, Joe, as you know, some of these synergies are going to materialize sooner than later. And we'll be in a position that once we get the transaction closed and an upcoming call to give you more clarity on that in terms of how we're thinking about enhanced growth rates of the new company.

顯然，喬，如你所知，其中一些協同作用遲早會實現。我們將處於這樣的位置，即一旦我們完成交易並在即將到來的電話會議上讓您更清楚地了解我們如何考慮提高新公司的增長率。

Our next question will come from Mike Halloran with Baird.

我們的下一個問題將來自 Mike Halloran 和 Baird。

So following up a little bit on, I think, Nate's first question, so you think about the -- you've seen some steady deployments here, the -- well, you're expecting steady deployments here on the M&CS side over the next period of time here, call it a couple of years, which should give you some pretty good visibility. Does it sound like the lag in deployments and delays and deployments have impacted call it, that order cadence. It seems like the bottom was back half of the year and first quarter saw some nice sequential improvement on that side. I guess I'd like to understand a little bit about what that backfill looks like, what the conversations are looking like from a pipeline perspective on that side? And how you think about the visibility here over the next period of time when you put those 2 together? The deployment piece and then how that pipeline and thought process with the customers is going?

所以我想跟進一點，Nate 的第一個問題，所以你考慮 - 你在這裡看到了一些穩定的部署， - 好吧，你期待下一個 M＆CS 方面的穩定部署在這裡的一段時間，稱之為幾年，這應該會給你一些很好的知名度。聽起來部署和延遲的滯後和部署是否影響了調用它，即訂單節奏。似乎底部已經回到了今年的一半，第一季度在這方面看到了一些不錯的環比改善。我想我想稍微了解一下回填是什麼樣子的，從那邊的管道角度來看對話是什麼樣子的？當你把這兩個放在一起時，你如何看待接下來一段時間這裡的可見性？部署部分以及與客戶的管道和思維過程如何進行？

Yes. Mike, it's Matthew. We feel really bullish on it. You can see our orders growth in Q1 was 8%. Maybe just take a step back and look at AMI adoption in total for the U.S., it's only around 30% today. And there's a very strong value proposition for this offering for our utility partners to make them more productive and more efficient in their business. And that's something -- coming through the pandemic, they've really gotten laser-focused on. And I would say even with [digital] in general, have really latched on to and started to ramp up their capabilities. So we're very bullish over the long term that will be more and more adoption. We're still kind of in the early innings, kind of 30% in and then when you take a step back and look around the globe, other parts of the world are a decade behind the U.S. in adoption of AMI network.

是的。邁克，是馬修。我們真的很看好它。你可以看到我們第一季度的訂單增長是 8%。也許退後一步，看看美國 AMI 的總體採用率，今天只有 30% 左右。對於我們的公用事業合作夥伴而言，此產品具有非常強大的價值主張，可以使他們在業務中提高生產力和效率。這就是 - 通過大流行，他們真的得到了激光聚焦。而且我會說，即使是 [digital] 一般情況下，也已經真正抓住並開始提升他們的能力。因此，從長遠來看，我們非常看好越來越多的採用。我們仍處於早期階段，大約 30%，然後當你退後一步並環顧全球時，世界其他地區在採用 AMI 網絡方面比美國落後十年。

So as we not only work the U.S. marketplace in the U.K., which is also very similar to the U.S., we're now starting to focus on the international front and how we can improve our opportunities there funding for non-revenue water and smart metering really picks up to some of the subsidies that are coming out in Europe.

因此，由於我們不僅在英國開展美國市場，這也與美國非常相似，我們現在開始關注國際前沿，以及我們如何改善我們在那裡的機會，為無收益水和智能計量提供資金真正接受了歐洲即將推出的一些補貼。

And Mike, it would be worth -- Matthew, maybe if you want to give an update. We haven't talked about the Idrica partnership that we announced last earnings call because that really speaks also to what utilities are doing around the digital side and what we're seeing there in terms of early wins.

邁克，值得——馬修，如果你想提供最新信息的話。我們沒有談論我們在上次財報電話會議上宣布的 Idrica 合作夥伴關係，因為這也確實說明了公用事業公司在數字方面所做的工作以及我們在早期勝利方面看到的情況。

Yes. Just to reframe it just for folks that were not on the last call, it's exclusive commercial partnership worldwide. It is a SaaS business model. Idrica is headquartered in Valencia, Spain. They're a leader in what we call data management and analytics. And as we're out talking to a lot of our utility customers, the biggest pain point we hear from these partners is they need to have a singular platform to integrate all of their applications and data. They have multiple applications, passwords, login, siloed information and this really gives us the platform much like a smartphone, like an iOS platform to be able to integrate all these disparate systems. It's a proven platform. It's been deployed at over 300-plus utilities. What I'd like to say a lot is built by a utility operator for utilities. They actually understand the utility workflows, which is really important, coupled with our application knowledge that we have as an OEM.

是的。只是為那些沒有參加最後一次通話的人重新構建它，它是全球獨家商業合作夥伴關係。它是一種 SaaS 商業模式。 Idrica 總部位於西班牙瓦倫西亞。他們是我們所說的數據管理和分析領域的領導者。當我們與許多公用事業客戶交談時，我們從這些合作夥伴那裡聽到的最大痛點是他們需要一個單一的平台來集成他們所有的應用程序和數據。他們有多個應用程序、密碼、登錄名、孤立的信息，這確實為我們提供了一個非常像智能手機的平台，就像一個 iOS 平台，能夠集成所有這些不同的系統。這是一個經過驗證的平台。它已部署在 300 多家公用事業公司。我想說的很多是公用事業運營商為公用事業建造的。他們實際上了解實用工作流程，這非常重要，再加上我們作為 OEM 擁有的應用知識。

Our teams are building strong commercial momentum. Sandy talked about the investments that we're making around the globe, especially in Europe, on digital investments and solution selling to deploy this platform. And we built a significant funnel over the past 3 months, and it's really also to enable us to pull through a significant amount of Xylem content. And I would say on the next call, we'll be in a much better position to kind of get into some detail on that as it matures over the next 90 days.

我們的團隊正在建立強大的商業勢頭。 Sandy 談到了我們在全球範圍內進行的投資，尤其是在歐洲，用於數字投資和解決方案銷售以部署該平台。在過去的 3 個月裡，我們建立了一個重要的渠道，這實際上也使我們能夠獲得大量的 Xylem 內容。我會在下一次電話會議上說，隨著它在接下來的 90 天內成熟，我們將能夠更好地了解一些細節。

And then maybe a similar conversation, obviously, you don't have the deployment component necessarily with the core utility pieces within your infrastructure business, but maybe a similar conversation about bidding pipeline, thoughts, domestic versus international and the ability to maintain the momentum on the pump and the treatment side there?

然後可能會進行類似的對話，顯然，您的基礎設施業務中不一定具有部署組件和核心實用程序，但可能會進行類似的關於投標管道、思想、國內與國際以及保持勢頭的能力的對話泵和治療方在那裡？

Yes. So I'd say, in Water Infrastructure, the utility business, obviously, the OpEx is very strong around the world. We haven't seen a really slow down in CapEx either. If you think about Europe specifically, they're will wedded to making sure they spend their CapEx. And although I'm not going to get in -- go down the rabbit hole of the infrastructure bill, but over time, that will start to drip out and start to really provide long-term support and demand in the utility space with Water Infrastructure, both in the U.S. and around the world. There's other programs like the European Recovery and Resiliency Act, you've got the AMP cycle in the U.K. And all these are coming online in the next -- anywhere from 6 to 12 to 18 months to really buoy and lift the demand signal for that sector.

是的。所以我想說，在水利基礎設施、公用事業業務中，顯然，OpEx 在世界範圍內非常強大。我們也沒有看到資本支出真正放緩。如果您具體考慮歐洲，他們會執著於確保支出資本支出。雖然我不會進入 - 進入基礎設施法案的兔子洞，但隨著時間的推移，它會開始滴落並開始真正提供水基礎設施公用事業領域的長期支持和需求，在美國和世界各地。還有其他計劃，例如《歐洲復甦和彈性法案》，您在英國有 AMP 週期所有這些都將在接下來的 6 到 12 到 18 個月內上線，以真正提振和提升需求信號部門。

And Mike, a couple of other proof points. So the -- we look very much at the treatment bidding pipeline because that's a leading indicator for the health of the wastewater side of the utilities and that bidding pipeline continues to grow off of record levels to our backlog in Water Infrastructure itself, was up 14% in the quarter. So really indicating strong health there in that part of the business.

邁克，還有其他幾個證據。所以 - 我們非常關注處理招標管道，因為這是公用事業廢水方面健康狀況的領先指標，並且招標管道繼續增長，超過我們在水基礎設施本身積壓的記錄水平，上升了 14本季度的百分比。因此，這確實表明業務的那部分健康狀況良好。

Our next question will come from Scott Davis with Melius Research.

我們的下一個問題將來自 Melius Research 的 Scott Davis。

I was just kind of curious on how you guys think about the kind of long-term growth algorithm of industrial versus industrial production indicators and kind of when I think about the ebbs and flows, there's so much of the installed base that's probably inefficient at this point could be pulled out. And there's all these new projects, mega projects that we talk a lot about, including some pretty high intensity stuff like semi fabs, I would imagine you guys have a lot of content on. So is there any way to kind of quantify or think about growing 2x IP or 3x or 1.5x. I'm just kind of curious how you guys think about internal.

我只是很好奇你們如何看待工業與工業生產指標的長期增長算法，以及當我考慮潮起潮落時，有太多的安裝基礎可能在這方面效率低下點可以拔掉。還有我們經常談論的所有這些新項目、大型項目，包括一些相當高強度的東西，比如半晶圓廠，我想你們有很多內容。那麼有沒有什麼方法可以量化或考慮增長 2 倍或 3 倍或 1.5 倍的 IP。我只是有點好奇你們是如何看待內部的。

Yes, Scott, great question. So I'll put a caveat upfront and say, once we close the transaction with Evoqua, we'll be able to talk much more around how we view their growth outlook and the growth outlook of the combined company both stand-alone but also through the revenue synergies that we're targeting. But as we just look at our respective participation in the industrial piece of the business, I would say for Xylem because of the nature of what we currently sell into the industrial base tends to be more of a GDP kind of business. We're selling into the periphery of manufacturing facilities. And so as long as the facilities are up and running, they're burning through various types of pumps that we sell replacement into. It's a good business, good steady, but it's going to typically be in that low single digit, sometimes mid-single-digit kind of growth.

是的，斯科特，好問題。所以我要提前聲明，一旦我們完成與 Evoqua 的交易，我們將能夠更多地討論我們如何看待他們的增長前景以及合併後公司的增長前景，無論是獨立的還是通過我們瞄準的收入協同效應。但當我們只看我們各自參與的工業業務時，我會說 Xylem，因為我們目前向工業基地銷售的產品的性質往往更像是一種 GDP 業務。我們正在向製造設施的外圍銷售。因此，只要設施正常運行，它們就會消耗我們出售替代品的各種類型的泵。這是一項很好的業務，非常穩定，但通常會以低個位數，有時是中等個位數的方式增長。

When you look at what Evoqua does, they're providing very different water management services into the so-called industrial users of water. And what drives the growth there, which historically has been in that kind of at least mid-single digit, if not even higher than that, depending upon where they are in the cycle is -- and this is where we do believe it will outpace broader GDP growth, is because of the increased demands coming in to those users around: one, making sure they have access to sustainable water supply to keep their operations up and running. The value of water to them is not the price they pay per gallon or liter. They don't -- it's not a big number for them. The value order to them is when they don't have it and they're operating in water-stressed areas and they have production stoppage and it's lost revenue and margin.

當你看看 Evoqua 所做的事情時，他們正在為所謂的工業用水用戶提供截然不同的水資源管理服務。是什麼推動了那裡的增長，從歷史上看，這種增長至少是中等個位數，甚至更高，這取決於它們在周期中所處的位置——我們確實相信它會超過更廣泛的 GDP 增長，是因為周圍用戶的需求增加：第一，確保他們能夠獲得可持續的供水以保持其運營正常運行。水對他們的價值不是他們每加侖或每升支付的價格。他們沒有——這對他們來說不是一個大數字。對他們來說，價值秩序是當他們沒有它並且他們在缺水地區運營並且他們停產並且損失收入和利潤時。

The second is the increased regulatory pressure on them to manage their discharge of wastewater. And so fines, penalties, but also reputational concerns they have and making sure they're seen as responsible citizens in the community. So those are the pressures that we see are really driving the demand right now in that part of what we call the industrial sector of water, and we see that continuing.

第二是對他們管理廢水排放的監管壓力增加。因此，罰款、處罰，還有他們的聲譽問題，並確保他們被視為社區中負責任的公民。因此，我們看到這些壓力正在真正推動我們稱之為水工業部門的那部分需求，而且我們看到這種情況仍在繼續。

That's super helpful, Patrick. Am I correct to assume that a semiconductor fab is going to have a pretty large TAM for you guys?

這非常有幫助，帕特里克。我假設半導體工廠將為你們提供相當大的 TAM 是否正確？

Yes. That is correct.

是的。那是對的。

Our next question will come from Andy Kaplowitz with Citigroup.

我們的下一個問題將來自花旗集團的 Andy Kaplowitz。

Probably for Matthew, I know you've been working on a number of initiatives to enhance Xylem's productivity. Obviously, Xylem raised revenue guidance nicely for '23. I think you kept your margins. So maybe just more color to the progress you're making and what would you see going forward there?

可能是對 Matthew 而言，我知道你一直致力於提高 Xylem 生產力的許多舉措。顯然，Xylem 很好地提高了 23 年的收入預期。我想你保留了利潤。因此，也許只是為您正在取得的進展增添更多色彩，您會在那裡看到什麼？

Yes. I mean I'll start this off and then maybe turn it over to Sandy to kind of wrap this up. But we see really good momentum in driving productivity, Andy in the business. There are several different areas that we're addressing in doing that, whether it's across simplifying our portfolio, reducing SKUs, making our factories more efficient, in what we build and really moving the long tail out. In terms of footprint, I mean, continued factory rationalization is, obviously, another point that we're looking at.

是的。我的意思是我會先開始，然後可能會把它交給 Sandy 來完成。但我們在提高生產力方面看到了非常好的勢頭，安迪在業務中。在這樣做的過程中，我們正在解決幾個不同的領域，無論是簡化我們的產品組合、減少 SKU、提高我們的工廠效率，還是在我們建造的產品中，以及真正將長尾移出。就足跡而言，我的意思是，持續的工廠合理化顯然是我們正在關注的另一點。

Also within our M&CS business as we continue to move that business forward, getting after productivity there has been a focus area of ours, it's been kind of 2.5% of spend, and we need to get that up around 3.5%, 4%, 4.5%, which is kind of typical of the other 2 segments. So that's another big focus area as well. And also within M&CS too, if you kind of unpack the backlog, the shift to water, the water mix will pick up over time and provide some nice drop-through in high-calorie margin. So it's a combination of things that we're looking at holistically across the business to make sure, over time, we continue to build sequential momentum in the margin line.

同樣在我們的 M&CS 業務中，隨著我們繼續推動該業務向前發展，提高生產力一直是我們的重點領域，大約佔支出的 2.5%，我們需要將其提高到 3.5%、4%、4.5 左右%，這是其他 2 個細分市場的典型代表。所以這也是另一個重點領域。同樣在 M&CS 內部，如果你打開積壓的包裝，轉向水，水的混合物會隨著時間的推移而增加，並在高熱量利潤率方面提供一些不錯的下降。因此，這是我們在整個業務中全面考慮的事情的組合，以確保隨著時間的推移，我們繼續在利潤線上建立連續的勢頭。

Yes. What I'd add on top of that, Andy, is obviously, we're very focused on margin expansion and are the goals we set for our organization for 2023 contemplated significant margin expansion. I think we've gotten out of the gate with a good start there. And if we look at what we're thinking about the rest of the year, one of the items that we're focused on is what do the incremental margins look like and our guide contemplates 30% incremental margins at a period where we're continuing to make investments and a period of time where we don't have the most optimal mix as we work on the deployment. So I think we feel good about where we've landed and we're going to continue to be focused on productivity through the rest of the year. And we're going to be focused on making sure that our discretionary costs remain tight.

是的。安迪，除此之外，我要補充的是，顯然，我們非常關注利潤率擴張，我們為組織設定的 2023 年目標是否考慮了顯著的利潤率擴張。我認為我們已經有了一個良好的開端。如果我們看看我們對今年剩餘時間的想法，我們關注的項目之一是增量利潤率是什麼樣子的，我們的指南考慮了 30% 的增量利潤率。繼續進行投資，並且在我們進行部署時我們沒有最佳組合的一段時間。因此，我認為我們對我們所取得的成就感到滿意，並且我們將在今年餘下的時間裡繼續關註生產力。我們將專注於確保我們的可自由支配成本保持緊張。

Yes. We're not anywhere by no means satisfied yet with even where we are saying margins are going to be this year. Obviously, we're going to continue to run hard to drive those up even more. But again, we feel it's responsible, prudent guide at this point in time.

是的。即使我們說的是今年的利潤率，我們也絕不滿意。顯然，我們將繼續努力以進一步提高它們。但同樣，我們認為此時此刻它是負責任的、審慎的指南。

Very helpful guys. And then, Patrick, you talked a little bit about Europe and the U.S. in terms of regions, but I think China has been a bit of a drag on your performance in the past. It seems to look a little better in Q1. But what are you seeing out of that region in the near term or going forward?

非常有幫助的人。然後，帕特里克，你在地區方面談到了歐洲和美國，但我認為中國過去對你的表現有點拖累。 Q1 看起來好一些。但您在近期或未來對該地區有何看法？

Yes. No, thanks for the question, Andy. It has been talked about a lot. And it really is an emerging bright spot for us because we absorbed some pretty challenging numbers there last year. And you know that on the long term bull on China, just given where they are in the overall investment cycle from a water standpoint. So orders in Q1 and revenue were both up high single digit and outperformed there. Really encouraged by the reopening across China and what's happening from a GDP standpoint there. It really sets us up for a pretty strong year. I would say that we're seeing a faster recovery in the industrial and commercial piece of the market there than we are utilities. But utilities based upon our bidding pipeline and backlog are set to recover in the second half. So that's a further tailwind for us. And again, the funnel remains very healthy there. So encouraged by it. Still a long way to go, but we expect it to be a tailwind this year.

是的。不，謝謝你的問題，安迪。它已經被談論了很多。這對我們來說確實是一個新興的亮點，因為我們去年在那裡吸收了一些非常具有挑戰性的數字。而且你知道，從水資源的角度來看，就中國的長期牛市而言，只是考慮到它們在整個投資週期中所處的位置。因此，第一季度的訂單和收入都達到了高個位數，並且表現優於那裡。中國各地的重新開放以及從國內生產總值的角度來看正在發生的事情真的讓我感到鼓舞。這真的讓我們度過了一個非常強勁的一年。我要說的是，我們看到那裡的工業和商業市場比公用事業市場復甦得更快。但基於我們的投標管道和積壓的公用事業將在下半年恢復。所以這對我們來說是一個進一步的順風。再一次，漏斗在那裡仍然非常健康。受其鼓舞。還有很長的路要走，但我們預計今年會順風順水。

Thank you. This concludes the Q&A portion of today's call. I would now like to turn the floor back over to Patrick Decker for any additional or closing remarks.

謝謝。今天電話會議的問答部分到此結束。我現在想把發言權轉回給 Patrick Decker，請他發表任何補充或結束語。

Well, again, thanks, everybody, for your continued interest and questions and the support. Look forward to catching up with you on our next earnings call. And I'm sure we'll see many of you at various conferences between now and then. As always, stay safe. And I look forward to speaking to you again.

好吧，再次感謝大家一直以來的關注、問題和支持。期待在我們的下一次財報電話會議上與您見面。我相信我們會時不時地在各種會議上見到你們中的許多人。一如既往，注意安全。我期待著再次與您交談。

Thank you. This concludes today's Xylem First Quarter 2023 Earnings Conference Call. Please disconnect your lines at this time, and have a wonderful day.

謝謝。今天的 Xylem 2023 年第一季度收益電話會議到此結束。此時請斷開您的線路，祝您有美好的一天。