賽莱默 (XYL) 2024 Q2 法說會逐字稿

Good day, everyone, and welcome to the Xylem's second-quarter 2024 results conference call. (Operator Instructions) Please note this event is being recorded.

大家好，歡迎參加賽萊默 2024 年第二季業績電話會議。 （操作員說明）請注意此事件正在被記錄。

I'll now turn the conference over to Andrea van der Berg, Vice President of Investor Relations. Please go ahead.

我現在將會議交給投資人關係副總裁 Andrea van der Berg。請繼續。

Thank you, operator. Good morning, everyone, and welcome to Xylem's second-quarter 2024 earnings call. With me today are Chief Executive Officer, Matthew Pine; and Chief Financial Officer, Bill Grogan. They will provide their perspective on Xylem's second-quarter 2024 results and discuss the third quarter and full-year outlook.

謝謝你，接線生。大家早安，歡迎參加賽萊默 2024 年第二季財報電話會議。今天與我在一起的有執行長馬修派恩 (Matthew Pine)；和財務長比爾·格羅根。他們將提供對賽萊默 2024 年第二季業績的看法，並討論第三季和全年的前景。

Following our prepared remarks, we will address questions related to the information covered on the call. Also, please keep to one question and follow-up and then return to the queue. As a reminder, this call and webcast are accompanied by a slide presentation available on the Investors section of our website. A replay of today's call will be available until midnight, August 6. Additionally, the call will be available for playback via the Investors section of our website under the heading Investor Events.

在我們準備好的發言之後，我們將回答與電話會議所涵蓋資訊相關的問題。另外，請保留一個問題並跟進，然後返回隊列。謹此提醒，本次電話會議和網路廣播均附有幻燈片演示文稿，可在我們網站的投資者部分查看。今天的電話會議重播將持續到 8 月 6 日午夜。

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

請翻到投影片 2。這些聲明受到未來風險和不確定性的影響，例如賽萊默最新的 10-K 表格年度報告以及隨後向 SEC 提交的報告中描述的因素。請注意，本公司沒有義務公開更新任何前瞻性聲明以反映後續事件或情況，實際事件或結果可能與預期有重大差異。

Please turn to slide 3. We've provided you with a summary of our key performance metrics, including both GAAP and non-GAAP metrics, with references to prior-year segment metric be made on a comparative basis, reflecting the change in segments as of the beginning of the year. For purposes of call, all references will be on an organic and/or adjusted basis, unless otherwise indicated, and non-GAAP financials have been reconciled for you and are included in the appendix section of the presentation.

請參閱投影片 3。出於電話會議的目的，除非另有說明，所有參考資料都將基於有機和/或調整的基礎，並且非公認會計準則財務數據已為您進行了核對，並包含在演示文稿的附錄部分中。

Now, please turn to slide 4 and will turn the call over to our CEO, Matthew Pine.

現在，請翻到幻燈片 4，我們會將電話轉給我們的執行長 Matthew Pine。

Thanks, Andrea. Good morning, everyone, and thank you for joining us today. It's a pleasure to report the achievements of the Xylem team in the second quarter.

謝謝，安德里亞。大家早安，感謝您今天加入我們。很高興向大家報告賽萊默團隊在第二季的成就。

As you have seen in this morning's release, the team delivered another very strong quarter, outperforming expectations on all metrics, with high-single-digit organic revenue growth, reflecting gains in both volume and price. The team also expanded adjusted EBITDA margin 170 basis points. And without outperformance, we delivered adjusted EPS growth of 11%.

正如您在今天早上的發布中所看到的，該團隊又交付了一個非常強勁的季度，所有指標都超出了預期，有機收入實現高個位數增長，反映了銷量和價格的增長。該團隊還將調整後 EBITDA 利潤率擴大了 170 個基點。在沒有表現出色的情況下，我們的調整後每股收益成長了 11%。

The story of the second quarter is similar to Q1. On the demand side, our largest markets continue to be resilient. Internally, our outperformance is driven by increasingly disciplined operational execution by the team. This kind of performance momentum is only possible when the whole team is engaged and aligned to make a difference. And I want to say a big thank you to the whole Xylem team for the dedication and drive they've demonstrated through the first half of the year.

第二季的故事與第一季類似。在需求方面，我們最大的市場持續保持彈性。在內部，我們的優異表現是由團隊日益嚴格的營運執行所推動的。只有當整個團隊都積極參與並齊心協力做出改變時，這種績效動力才有可能實現。我想對整個賽萊默團隊在今年上半年所展現的奉獻精神和幹勁表示衷心的感謝。

While there were a lot of highlights across the team, I particularly want to mention the standout performance and measurement and control solutions. MCS segment revenue was up 26% and EBITDA margins are up 700 basis points versus this time last year. The team is doing an outstanding job.

雖然整個團隊有很多亮點，但我特別想提一下出色的效能以及測量和控制解決方案。與去年同期相比，MCS 部門營收成長了 26%，EBITDA 利潤率成長了 700 個基點。該團隊做得非常出色。

Our first-half performance is a reflection of the value-creation duration we set early in the year and discussed at Xylem's Investor Day in May. That direction includes both resilient above-market growth and accelerated margin expansion. It's gratifying to see the kind of momentum reflected in our quarterly performance. In addition, our simplification initiatives and our work on 80/20 are progressing well and are set to pay off beginning in 2025.

我們上半年的業績反映了我們在年初設定的價值創造期限，並在 5 月的賽萊默投資者日上進行了討論。這一方向包括高於市場的彈性成長和加速的利潤率擴張。很高興看到我們的季度業績反映出這種勢頭。此外，我們的簡化措施和 80/20 工作進展順利，預計 2025 年開始取得成效。

Turning to the integration of Evoqua in late May, we passed the one-year anniversary of our combination with Evoqua. The combination continues to reveal its value, cost synergies are well on track, and the team is looking to accelerate our pace wherever possible. And our commercial teams are successfully taking Xylem's combined capabilities to the many customers who will benefit from our integrated solutions, both in utility and industrial end markets. With Evoqua integration on track, strong momentum from the first half, resilient demand, and the team's increasing operational commercial discipline, we're raising our full-year guide for both revenue and margin increasing our EPS guidance $0.06 from the prior midpoint.

談到 Evoqua 的整合，5 月下旬，我們度過了與 Evoqua 合併一週年紀念日。這次合併持續展現其價值，成本綜效進展順利，團隊希望盡可能加快我們的腳步。我們的商業團隊正在成功地將賽萊默的綜合能力帶給眾多客戶，他們將受益於我們在公用事業和工業終端市場的整合解決方案。隨著 Evoqua 整合步入正軌、上半年的強勁勢頭、彈性需求以及團隊不斷加強的營運商業紀律，我們將提高全年收入和利潤率指引，將 EPS 指引較之前的中點提高 0.06 美元。

In a moment, I'll provide an update on our high-impact culture and our leadership alignment and also on our industry-leading 2030 sustainability goals. But first, I'm going to turn it over to Bill to double click on the quarter's results, our financial position, and our outlook. Bill?

稍後，我將介紹我們的高影響力文化和領導層協調以及我們行業領先的 2030 年永續發展目標的最新情況。但首先，我將把它交給比爾雙擊本季的業績、我們的財務狀況和我們的前景。帳單？

Thanks, Matthew. Please turn to Slide 5. Q2 was another great quarter, and I want to thank our entire organization for their amazing work. We outperformed against our guide across revenue, margin, and earnings per share. We continue to see resilient demand, and our backlog is at $5.2 billion, a modest decline from prior year as we execute on MCS pass-through backlog. Book-to-bill was approximately 1, supported by strength in water infrastructure, while organic orders were down 1% in the quarter, driven by project timing within MCS and WSS.

謝謝，馬修。請參閱投影片 5。我們在營收、利潤率和每股盈餘方面的表現優於預期。我們繼續看到需求的彈性，我們的積壓訂單為 52 億美元，由於我們執行 MCS 傳遞積壓訂單，比去年略有下降。在水利基礎設施實力的支撐下，訂單出貨比約為 1，而受 MCS 和 WSS 內專案時間安排的推動，本季有機訂單下降了 1%。

Total revenues grew 26%, and organic revenue rose 9%, exceeding our guidance on a healthy combination of volume and price. Our performance was led by MCS and WSS as we saw growth in all regions led by double-digit growth in the US.

總收入成長 26%，有機收入成長 9%，超出了我們對數量和價格健康組合的指導。我們的業績以 MCS 和 WSS 為主導，我們看到所有地區都實現了成長，其中美國的兩位數成長為主導。

EBITDA margin was 20.8%, up 170 basis points from the prior year. With productivity savings, strong volume, and price more than offsetting inflation, investments, and mix. This reflects incrementals of 28% on a consolidated basis and 50% on a pro forma basis. Our EPS in the quarter was $1.09, above the high end of our guidance by $0.04 and up 11% over the prior year. Our balance sheet is strong with net debt to adjusted EBITDA at 0.7 time. Year-to-date free cash flow was up 200% versus the prior year, and conversion of 62% is strong given seasonality. This year-over-year improvement was driven by higher net income, offset slightly by increased CapEx, and we continue to benefit from improved working capital efficiency.

EBITDA 利潤率為 20.8%，比上年增長 170 個基點。生產力的節省、強勁的銷售和價格足以抵消通貨膨脹、投資和組合。這反映了合併基礎上 28% 的增量和備考基礎上 50% 的增量。本季我們的每股收益為 1.09 美元，比我們指導的上限高出 0.04 美元，比上年增長 11%。我們的資產負債表強勁，淨負債與調整後 EBITDA 比率為 0.7 倍。年初至今的自由現金流比前一年增長了 200%，考慮到季節性因素，轉換率達到 62%，相當強勁。這一同比改善是由淨利潤增加推動的，但資本支出的增加略有抵消，我們繼續受益於營運資本效率的提高。

Please turn to slide 6. measurement and control solutions had another great quarter and, again, exceeded our expectations. MCS revenue was up 26%, driven by smart metering demand and backlog execution. However, due to project timing, orders were down 18%, and book-to-bill came in under 1. We worked down past due backlog, and total backlog for MCS now sits at roughly $2 billion, a 12% organic decrease from prior year.

請參閱投影片 6。在智慧計量需求和積壓執行的推動下，MCS 收入成長了 26%。然而，由於專案時間安排，訂單下降了 18%，訂單出貨比低於 1。

We finished the quarter with impressive EBITDA margins of 23.4%, up 700 basis points versus the prior year and up 70 bps sequentially. Margin expansion was driven by volume, price, productivity, and favorable mix more than offsetting inflation. As a reminder, we continue to expect a margin headwind from mix in the second half as energy meters account for a larger portion of our sales.

本季結束時，我們的 EBITDA 利潤率為 23.4%，比上年增長 700 個基點，比上一季增長 70 個基點。利潤率擴張是由數量、價格、生產力和有利的組合推動的，而不僅僅是抵消通貨膨脹。提醒一下，我們仍然預計下半年的利潤率會逆風，因為電能表占我們銷售額的很大一部分。

In water infrastructure, orders were up strong, 8% in the quarter led by robust treatment demand. Revenue exceeded our expectations with total growth of 22% and organic growth of 7%, driven by healthy demand across all regions and applications. Adjusted EBITDA margin for the segment was down 60 basis points, with roughly 40% pro forma incrementals. This decline was driven by inflation and acquisition, but was offset partially by productivity, volume, and price. Without the impact of acquisitions, adjusted EBITDA margin improved 40 basis points for the quarter.

在水務基礎設施領域，由於處理需求強勁，本季訂單成長 8%。在所有地區和應用的健康需求的推動下，收入超出了我們的預期，總成長 22%，有機成長 7%。該部門調整後的 EBITDA 利潤率下降了 60 個基點，預計增量約為 40%。這種下降是由通貨膨脹和收購推動的，但被生產力、數量和價格部分抵消。如果沒有收購的影響，本季調整後的 EBITDA 利潤率提高了 40 個基點。

In applied water, orders were up 5%, and book-to-bill was greater than 1, reflective of a few large project wins, which we'll ship next year. Revenues were down 4%, in line with our expectations, lapping strong comps on 12% growth in the second quarter of last year. The decline was primarily driven by softness in developed markets. Segment EBITDA margins declined 200 basis points year over year, but increased 100 basis points sequentially. Higher inflation and unfavorable mix was partially offset by productivity savings.

在應用水領域，訂單成長了 5%，訂單出貨比大於 1，這反映出我們贏得了一些大型項目，這些項目我們將於明年出貨。營收下降 4%，符合我們的預期，與去年第二季 12% 的成長相比表現強勁。下降的主要原因是已開發市場的疲軟。部門 EBITDA 利潤率年減 200 個基點，但較上季成長 100 個基點。較高的通貨膨脹和不利的結構被生產力節省部分抵消。

Closing the segments with water solutions and services. Orders declined 1% organically, driven by timing of large capital projects offset by strength in dewatering. Organic revenue was up 12% with healthy growth across most of the business. Adjusted EBITDA margin was strong at 23.8%, up 60 basis points and driven by volume, productivity, and price, offset in part by unfavorable mix and inflation. Two quarters in resegmentation, we continue to see synergy momentum and benefits for our customers in combining our service-based offerings.

透過水解決方案和服務來關閉這些細分市場。訂單有機下降 1%，原因是大型資本項目的時機被脫水業務的實力所抵消。有機收入成長了 12%，大部分業務都健康成長。調整後的 EBITDA 利潤率強勁，達到 23.8%，成長了 60 個基點，主要受到銷售、生產力和價格的推動，但部分被不利的結構和通膨所抵消。經過兩個季度的重新細分，我們繼續看到結合我們基於服務的產品所帶來的協同動力和為客戶帶來的好處。

Now, let's turn to slide 7 for our updated full-year and Q3 guidance. Given our first-half outperformance in both commercial and operational momentum, we are raising our full-year guide. We are increasing our revenue guide by approximately $50 million, up from $8.5 billion. This reflects an additional 0.5 point of growth at the midpoint versus our prior guidance. That will put total revenue growth at approximately 16% and organic revenue growth at 5% to 6%.

現在，讓我們轉向幻燈片 7，了解更新後的全年和第三季指導。鑑於我們上半年在商業和營運動能方面均表現出色，我們正在上調全年指引。我們將收入指引從 85 億美元增加了約 5,000 萬美元。這反映了與我們先前的指導相比，中點額外增加了 0.5 個百分點。這將使總收入成長約 16%，有機收入成長 5% 至 6%。

The integration is going smoothly, and we continue to expect $100 million of exit run rate cost synergies in 2024 with the potential to accelerate by year-end. We are confident about driving further margin expansion with operational productivity and are raising our EBITDA margin guidance to about 20.5%. That represents 160 basis points of expansion versus the prior year, driven by higher volume, productivity, including cost synergies, and price offsetting inflation.

整合進展順利，我們繼續預計 2024 年退出運行率成本綜效將達到 1 億美元，並有可能在年底加速。我們有信心透過營運生產力進一步推動利潤率擴張，並將 EBITDA 利潤率指引提高至 20.5% 左右。這意味著與前一年相比擴張了 160 個基點，這是由於產量、生產率（包括成本協同效應）和價格抵消通膨的推動。

Our updated EPS guidance of $4.18 to $4.28 reflects an increase of $0.06 at the midpoint. Free cash flow conversion for the year is now expected to be over 120% of net income. The full-year outlook at the segment level remains largely unchanged with the exception of MCS, which we now expect to grow at high-teens due to our first-half performance versus our previous outlook of low-teens.

我們更新後的每股盈餘指引為 4.18 美元至 4.28 美元，反映出中點增加了 0.06 美元。目前預計今年的自由現金流轉換將超過淨利的120%。除 MCS 之外，該細分市場的全年前景基本保持不變，由於我們上半年的業績與先前的低雙位數展望相比，我們現在預計該業務將以高雙位數成長。

For the quarter, we anticipate revenue growth will be 3% to 5% on a reported and organic basis. We expect third-quarter EBITDA margin to be in the range of 20.5% to 21%, up 70 to 120 basis points, driven by higher volumes, continued price realization, and productivity gains. This yields third-quarter EPS of $1.07 to $1.12.

我們預計本季的報告收入和有機收入成長率將為 3% 至 5%。我們預計，在產量增加、價格持續實現和生產力提高的推動下，第三季 EBITDA 利潤率將在 20.5% 至 21% 之間，成長 70 至 120 個基點。這使得第三季每股收益為 1.07 美元至 1.12 美元。

Our diversified portfolio of mission-critical products and services positions us well to address our customers' evolving needs, and we anticipate healthy demand across most end markets and applications. And we talked about our driving profitability through simplification efforts and our 80/20 implementations at the Investor Day in May. We are progressing well on those initiatives, and I want to reiterate our commitment to systematic margin improvement through operational excellence, supporting our long-term profitability framework. While we are closely monitoring the macroenvironment, including geopolitical, election uncertainty and tariffs, our overall outlook for the year remains positive.

我們多元化的關鍵任務產品和服務組合使我們能夠很好地滿足客戶不斷變化的需求，並且我們預計大多數終端市場和應用的健康需求。我們在 5 月的投資者日上討論了透過簡化工作和 80/20 實施來提高獲利能力。我們在這些舉措上進展順利，我想重申我們對透過卓越營運系統性提高利潤率的承諾，支持我們的長期獲利框架。雖然我們正在密切關注宏觀環境，包括地緣政治、選舉不確定性和關稅，但我們對今年的整體前景仍然樂觀。

With that, please turn to slide 8, and I'll turn the call back over to Matthew for closing comments.

接下來，請翻到投影片 8，我會將電話轉回給 Matthew，以徵求結束意見。

Thanks, Bill. I'd like to mention two events in the quarter that don't show up in the financial results, but are fundamental to Xylem's success and impact. First, in June, just a few weeks after our Investor Day, we gathered Xylem's global leadership team in Washington DC. This was the first time we had our top 150 executives in one room, spanning legacy Xylem and legacy Evoqua. It was an energizing two days of collaboration, focused on the work of leadership alignment and culture.

謝謝，比爾。我想提一下本季的兩件事，這些事件沒有出現在財務表現中，但對賽萊默的成功和影響至關重要。首先，六月，就在投資者日幾週後，我們在華盛頓特區召集了賽萊默的全球領導團隊。這是我們第一次將 150 名高階主管聚集在一個房間，其中包括傳統 Xylem 和傳統 Evoqua。這是充滿活力的兩天合作，重點是領導協調和文化工作。

I've spoken before about culture as the fundamental how of Xylem, how we'll deliver stronger execution of our strategy, how we'll realize our aspirations, how we'll create our next chapter of Xylem's impact. You can see in our second-quarter results that the team is already working well and winning.

我之前曾談到文化是賽萊默的基本運作方式，我們將如何更強有力地執行我們的策略，我們將如何實現我們的願望，我們將如何創造賽萊默影響力的下一個篇章。您可以從我們第二季的業績中看到，該團隊已經運作良好並且取得了勝利。

What our leadership summit reinforced was how much more value creation potential we have ahead of us with an aligned team and a high-impact culture. It was fantastic to see the team so engaged by the opportunities ahead of us. Last quarter also saw the publication of our annual sustainability report. We're very pleased to be tracking well towards our 2025 goals. But we took the opportunity presented by this year's report to set out our aspirations beyond 2025.

我們的領導力高峰會強調的是，憑藉團結的團隊和高影響力的文化，我們擁有更大的價值創造潛力。很高興看到我們的團隊對我們面前的機會如此投入。上季也發布了我們的年度永續發展報告。我們很高興能夠順利實現 2025 年目標。但我們利用今年報告提出的機會闡述了 2025 年以後的願景。

We're raising the bar again by setting 2030 sustainability goals in three strategic areas. The first is decarbonization, reducing our own greenhouse gas emissions and enabling our customers to decarbonize. Secondly is water stewardship aimed at reducing water demand. And finally, we'll provide access to water, sanitation, and hygiene for 80 million people. All 3 strengthen our customer relationships and increase our impact.

我們在三個策略領域制定了 2030 年永續發展目標，再次提高了標準。首先是脫碳，減少我們自己的溫室氣體排放，並使我們的客戶能夠脫碳。其次是旨在減少用水需求的水資源管理。最後，我們將為 8,000 萬人提供水、衛生設施和個人衛生。這三者都加強了我們的客戶關係並提高了我們的影響力。

Before turning to your questions, I have one more special note. This is Andrea van der Berg's last quarterly earnings call at the helm of Investor Relations. We're happy to announce that Andrea is taking on a new role within Xylem, and it's an exciting new opportunity for her. Over the years, so many of you have told me you deeply value Andrea's energy, accessibility, and professionalism, and I benefited from her insightful counsel and positive encouragement in every circumstance. So thank you, Andrea.

在回答你的問題之前，我還有一個特別說明。這是安德里亞范德伯格 (Andrea van der Berg) 負責投資者關係的最後一次季度財報電話會議。我們很高興地宣布 Andrea 將在賽萊默擔任新職務，這對她來說是一個令人興奮的新機會。多年來，你們中的許多人告訴我，你們非常看重安德里亞的活力、平易近人和專業精神，我在任何情況下都從她富有洞察力的建議和積極的鼓勵中受益匪淺。謝謝你，安德里亞。

Some of you have already met Keith Buettner, who is taking the reins as our investor relations leader. Keith has had great impact as the Head of Finance in water solutions and services segment, having joined us with the Evoqua combination more than a year ago. He brings deep knowledge of the business to his leadership of IR, and I'm confident you'll enjoy getting to know Keith and will find great value in his insights and perspectives.

你們中的一些人已經見過 Keith Buettner，他將擔任我們的投資者關係負責人。 Keith 作為水務解決方案和服務領域的財務主管，在一年多前加入 Evoqua 組合，產生了巨大影響。他為 IR 的領導帶來了深厚的業務知識，我相信您會喜歡了解 Keith，並會發現他的見解和觀點具有巨大價值。

And with that, let's go to your questions.

接下來，讓我們來回答你的問題。

(Operator Instructions) Deane Dray, RBC Capital Markets.

（操作員指令）Deane Dray，RBC 資本市場。

Thank you. Good morning, everyone.

謝謝。大家，早安。

Hey, good morning, Dean.

嘿，早上好，迪恩。

I'll add my welcome to Keith and wish Andrea best of luck and thanks for all your help.

我對 Keith 表示歡迎，並祝 Andrea 好運，並感謝您的所有幫助。

Thank you, Dean.

謝謝你，迪恩。

Maybe we can start with 80/20, and I'll also make the observation. You can see 80/20 at work in your conference call prepared remarks and slides and how much they've been slimmed down and you get right to the point, so really, appreciate that. So 80/20, I know you say the payoff is likely a 2025 event, but we heard lots of specifics at the Analyst Day on the rollout. So any updates you can share? I know we're still in the early innings, but you had Applied Water North America initially, MCS initially. Any kind of early actions and what can you share? Thanks.

也許我們可以從80/20開始，我也會進行觀察。你可以在電話會議中看到 80/20 的作用，準備好的演講稿和幻燈片，以及它們被精簡了多少，你開門見山，所以真的很欣賞這一點。所以 80/20，我知道你說回報可能是 2025 年的事件，但我們在分析師日上聽到了很多細節。那您有什麼更新可以分享嗎？我知道我們仍處於早期階段，但最初是Applied Water North America，MCS。有什麼早期行動嗎？謝謝。

No, happy to give an update. So again, the teams are progressing well. Like you said, we have three businesses in the thick of implementing the tool set. North American AWS and North American M&CS smart metering businesses. They are a few months ahead of global transport that kicked off in the second quarter. And we actually just had a kickoff for Applied Water in Europe that started on their journey last week.

不，很高興提供更新。再說一次，球隊進展順利。正如您所說，我們有三個業務部門正在大力實施該工具集。北美AWS和北美M&CS智慧計量業務。它們比第二季啟動的全球運輸提前了幾個月。實際上，我們剛剛在歐洲啟動了 Applied Water，上週開始了他們的旅程。

AWS and smart meeting have gone through their initial quads and quartile analysis, and now, they're working through the meat of segmenting their businesses, how they want to support their ongoing customer base, and then building their P&Ls, really highlighting the appropriate level of resources they need to run those businesses. They've come out with some initial price increases. Again, those benefits take a little while to work their way through the backlog. So again, no material short-term benefit, but we see a significant pickup at the end of this year, leading into 2025, where we'll see a more material P&L hit or pick up, excuse me.

AWS 和智慧會議已經完成了最初的四分位和四分位數分析，現在，他們正在研究細分業務的核心內容，了解他們希望如何支援其持續的客戶群，然後建立損益表，真正突出適當的水平他們經營這些業務所需的資源。他們已經提出了一些初步的價格上漲。同樣，這些好處需要一段時間才能解決積壓的問題。再說一遍，沒有實質的短期利益，但我們看到今年年底將出現顯著回升，進入 2025 年，我們將看到更實質的損益衝擊或回升，請原諒。

The teams are focusing on communicating with our customers and how the tool set is going to impact them. They're really talking to their largest customers and how these changes will benefit them in the long term, really improving the overall experience with Xylem as we bring new product innovation to them faster, improve our delivery and quality to them. So a lot of excitement around the tool set externally for their customer bases.

團隊專注於與客戶溝通以及工具組將如何影響他們。他們真正在與最大的客戶交談，以及這些變化將如何使他們長期受益，真正改善賽萊默的整體體驗，因為我們更快地為他們帶來新產品創新，改善我們的交付和品質。因此，對於為他們的客戶群提供的外部工具集，人們感到非常興奮。

So progress continues. I think we're right on schedule. Yeah, again, confident in the value 80/20 is going to bring and provide for us over the next several years. Really, in line with what we highlighted in the additional impact that tool set is going to have and the framework we laid out back in Investor Day.

所以進步仍在持續。我認為我們的計劃是正確的。是的，我再次對 80/20 將在未來幾年為我們帶來和提供的價值充滿信心。實際上，這與我們在工具集將產生的額外影響以及我們在投資者日制定的框架中強調的內容一致。

That's a really helpful update, Bill. Thanks. And given that most of the operating results today are either as expected or a little bit better, I could ask a broader industry question, if I could. Just implications on the Supreme Court overruling the Chevron Doctrine. I know we're still in the early innings, but any kind of high-level thoughts what the ripple effects might be in PFAS remediation at the federal level, the super fun timing. And look, I know it's not in your numbers, it's not in your three-year guide, but just the idea here is what might the implications be? And I can see that at the state level, that's where all the remediation efforts have been going in anyway, and the states like California are not waiting for the federal government to lead the way. So just from your perspective and insight, how do you think this plays out?

這是一個非常有用的更新，比爾。謝謝。鑑於今天的大部分經營業績要么符合預期，要么好一點，如果可以的話，我可以提出更廣泛的行業問題。只是對最高法院否決雪佛龍主義的影響。我知道我們仍處於早期階段，但任何高層都認為聯邦層級的 PFAS 修復可能會產生連鎖反應，這是一個超級有趣的時機。看，我知道這不在你們的數字中，不在你們的三年指南中，但這裡的想法是可能會產生什麼影響？我可以看到，在州一級，所有的補救措施都在進行中，而像加州這樣的州並沒有等待聯邦政府來帶頭。那麼，僅從您的角度和洞察力來看，您認為結果如何？

Thanks for the question, Deane. We didn't see this one coming. If you had asked us three months ago, this was not on our radar. So we're reacting to lots of different volatility out in the marketplace. But with the Supreme Court striking this down the Chevron Doctrine, it does introduce some uncertainty and some regulations and federal laws, the risk of being challenged much like the EPA's final rule on PFAS to your point.

謝謝你的提問，迪恩。我們沒有看到這個人的到來。如果您三個月前問過我們，我們不會考慮到這一點。因此，我們正在對市場上許多不同的波動做出反應。但隨著最高法院推翻了雪佛龍主義，它確實引入了一些不確定性以及一些法規和聯邦法律，以及受到挑戰的風險，就像您所說的 EPA 關於 PFAS 的最終規則一樣。

Additionally, beyond that, Deane, there's litigation ongoing already, that's challenging EPA's cost estimates used to set the MCL level, the maximum contaminant level at 4 parts per trillion, as you're aware. And it's only going to potentially push out what's already a long phase and timeline of three years to test and five years to mitigate PFAS.

此外，除此之外，迪恩，已經有訴訟正在進行，這對 EPA 用於設定 MCL 水平（如你所知，最大污染物水平為萬億分之四）的成本估算提出了挑戰。而且它只會有可能推遲已經很長的階段和時間表，即三年的測試時間和五年的緩解 PFAS 的時間。

So to your point, we think, ultimately, the states are going to fill in the gaps if a national PFAS regulation is reversed. We don't really anticipate that. But if it does, you've got about 11 states today with -- that have MCL, the maximum contaminant level for PFAS and drinking water already. You've got another 12 states that have some kind of PFAS regulation around either guidance health or notification levels, things of that nature and that's over half the US population.

因此，就您的觀點而言，我們認為，如果國家 PFAS 法規被撤銷，各州最終將填補空白。我們並沒有真正預料到這一點。但如果確實如此，那麼今天大約有 11 個州已經達到了 MCL（PFAS 和飲用水的最高污染物水平）。還有另外 12 個州針對健康指導或通知水準制定了某種 PFAS 法規，此類性質的州占美國人口的一半以上。

So while it may stumble a little bit out of the gates, and there's going to be some challenges, we're already seeing challenges in litigation, that's why we didn't bake it into our long-term framework. We just think it's too far out. But we stand ready to and well-positioned to partner with utilities, and we have partnered with utilities, as you know, and helping them manage this in other emerging contaminants. So more to come, but that's kind of what we think.

因此，雖然它可能會遇到一些困難，並且會遇到一些挑戰，但我們已經在訴訟中看到了挑戰，這就是為什麼我們沒有將其納入我們的長期框架。我們只是認為這太遙遠了。但我們已準備好並處於有利地位，可以與公用事業公司合作，正如您所知，我們已經與公用事業公司合作，並幫助他們管理其他新興污染物的問題。未來還會有更多，但這就是我們的想法。

That's real helpful. Thank you.

這真的很有幫助。謝謝。

Thank you.

謝謝。

Mike Halloran, Baird.

麥克·哈洛倫，貝爾德。

Hey. Good morning, everyone. Thanks, Andrea.

嘿。大家，早安。謝謝，安德里亞。

Morning.

早晨。

Welcome, Keith. So just level setting some stuff here. If I look at, obviously, very healthy margins on the quarter, Bill's earlier comment on the momentum there holds. But if you think about your demand commentary as well as how you're characterizing the second half of the year, it doesn't feel like much has changed from a trend thought process, how you're guiding the second half of the year? Just want to clarify that and any thoughts around that.

歡迎，基斯。所以只是在這裡設置一些東西。如果我看看本季非常健康的利潤率，比爾早些時候對這一勢頭的評論仍然成立。但如果你考慮一下你的需求評論以及你如何描述下半年，感覺趨勢思考過程並沒有太大變化，你如何指導下半年？只是想澄清這一點以及與之相關的任何想法。

Yeah, Mike. No change to our expectations for the second half. I think it's playing out exactly how we thought when we gave our update last quarter. With the exception that we had some accelerated performance in M&CS, which drove us to take up our full-year guide, we increased our full-year revenue guidance up to 5% to 6% and some timing of capital projects in WSS that drove better results in the second quarter.

是的，麥克。我們對下半年的期望沒有改變。我認為這正是我們在上季度發布更新時的想法。除了我們在 M&CS 領域取得了一些加速績效（這促使我們採用全年指南）外，我們將全年收入指導提高至 5% 至 6%，並且 WSS 中的一些資本項目時機也推動了更好的發展第二季的結果。

Sequentially, Q3 looks a lot like Q2 from a dollars perspective with just more challenging year-over-year comps really driving the lower implied organic growth rate. So we're still confident, bullish in most of our end markets. The macro noise that we highlighted is -- there's things out there. But from our perspective, we don't see a material impact or any signaling of expected slowdown for us.

因此，從美元角度來看，第三季度看起來很像第二季度，只是更具挑戰性的同比比較確實推動了較低的隱含有機成長率。因此，我們對大多數終端市場仍然充滿信心且看好。我們強調的宏觀噪音是──外面有東西。但從我們的角度來看，我們沒有看到實質影響或任何預期放緩的訊號。

M&CS, there's still high demand for our smart metering products and our differentiated AMI network. Orders were down, but again, that's primarily just project timing. There's still a strong funnel of large deals in the US and Europe. And we had several wins recently, a really good one that leverages the synergy sale with Idrica. So the team continues to do an excellent job of finding new projects and winning new business.

M&CS，對我們的智慧電錶產品和差異化 AMI 網路的需求仍然很高。訂單量下降了，但同樣，這主要只是專案時間安排的問題。美國和歐洲仍有強大的大型交易管道。我們最近取得了幾項勝利，其中一場非常好的勝利，充分利用了與 Idrica 的協同銷售。因此，該團隊在尋找新項目和贏得新業務方面繼續表現出色。

WSS, again, really strong growth, just really the timing of capital projects there, but they still have strong demand across the legacy ISS and the watering business. They had some orders lumpiness. Again, we had a huge build and operate project last quarter. We have a couple more of those in the funnel that could be realized in the orders here over the back half of the year. So really, nothing there that is any concern. Still bullish around kind of their high-growth verticals.

WSS 再次實現了真正強勁的成長，只是那裡的資本項目的時機，但他們對傳統國際太空站和澆水業務的需求仍然強勁。他們有一些訂單塊狀。同樣，上個季度我們有一個龐大的建設和營運項目。我們的漏斗中還有更多這些可以在今年下半年的訂單中實現。所以說真的，沒有什麼好擔心的。仍然看好他們的高成長垂直領域。

Water infrastructure, again, really strong performance and healthy demand, high-single-digit orders with growth across all the regions. Treatment was up over 20% with some large project wins. The transport business is one of our most differentiated business and continues to perform well. It's our developed markets and pretty much all our applications within WI are doing extremely well.

水基礎設施再次表現強勁，需求健康，所有地區的訂單量均呈現高個位數成長。隨著一些大型專案的成功，待遇提高了 20% 以上。運輸業務是我們最具差異化的業務之一，並且持續表現良好。這是我們發達的市場，我們在威斯康辛州內的幾乎所有應用程式都表現得非常好。

AWS, obviously, is the one market that remains a little bit challenged. Again, it's our shortest cycle, most cyclical group of businesses. But what we've seen there has been pretty consistent with our expectations, kind of low-single digit. Second-half comps get a little bit easier. So they'll gradually get to a lower organic decline. And then some of the project wins that we highlighted in the prepared remarks, we'll start to get them back on the road to growth in 2025.

顯然，AWS 是仍面臨一些挑戰的市場。再說一遍，這是我們週期最短、週期性最強的業務組。但我們所看到的情況與我們的預期非常一致，有點低個位數。下半場的比賽變得容易一些。因此，他們將逐漸減少有機衰退。然後我們在準備好的發言中強調的一些項目獲勝，我們將開始讓它們在 2025 年重新走上成長之路。

Great, super helpful. And then maybe some thoughts on how you think backlog tracks from here and what normal looks like once you work through the pass-through backlog across a couple of segments and how we think book-to-bill should track?

太棒了，超級有幫助。然後也許有一些關於您如何看待積壓跟踪的想法，以及一旦您處理了幾個細分市場的傳遞積壓工作後的正常情況，以及我們認為訂單到賬單應該如何跟踪？

Yeah. I would say backlog is still really strong. It declined slightly organically, and that's primarily just us continuing to work down the MCS past due backlog. That's a tough one to forecast just because of the lumpiness of some of the large projects within MCS. And again, just the new business opportunities within WSS and the build and operate. So I think we'll bleed a little bit here as we progress through the year, but still confident in kind of our long-term growth frameworks for the individual segments getting into 2025.

是的。我想說積壓仍然非常多。它自然略有下降，這主要是因為我們繼續處理 MCS 逾期積壓的問題。這是一個很難預測的問題，因為 MCS 內的一些大型專案十分混亂。再說一次，只是 WSS 內的新商機以及建造和營運。因此，我認為，隨著這一年的進展，我們會經歷一些失血，但仍然對進入 2025 年各個細分市場的長期成長框架充滿信心。

So I would say, lumpiness probably gives us a little bit of caution to give you a specific number, but again, robust demand and outlook for most of our end markets.

所以我想說，塊狀可能讓我們有點謹慎，給你一個具體的數字，但同樣，我們大多數終端市場的強勁需求和前景。

And Bill, you mean bleed to a more normalized level because of the past due backlog normalization, or are you suggesting something different?

比爾，你的意思是由於過去的積壓正常化而導致流血到更正常化的水平，或者你是否建議採取不同的措施？

No, exactly. That's spot on.

不，確切地說。那是對的。

Awesome. Great. Thanks, everyone. Appreciate it.

驚人的。偉大的。感謝大家。欣賞它。

Thank you.

謝謝。

Scott Davis, Melius Research.

斯科特·戴維斯，Melius 研究公司。

Hey, good morning, everybody, and congrats, Andrea, on your move.

嘿，大家早安，恭喜安德里亞，搬家了。

Good morning.

早安.

Guys, you didn't talk at all about capital deployment, which is fine, because you still have Evoqua coming in. But is there a certain tipping point where you get more confident being able to do deals? Are we close to that? Are we there? Just some commentary would be helpful.

夥計們，你們根本沒有談論資本部署，這很好，因為 Evoqua 仍然在進來。我們離那個很近了嗎？我們在嗎？只需一些評論就會有所幫助。

Good question. Again, like you mentioned, Scott, our first priority is to focus on the integration of Evoqua. I think you can see from the results that we're doing a great job on both the cost synergies, they're tracking well as well as the revenue synergies. We have, Scott, built a lot of muscle on M&A over the past 18 months with the planning of Evoqua and now the passing one year of execution. So we've started to build that muscle in the organization, which is going to help us going forward.

好問題。再次，正如您所提到的，Scott，我們的首要任務是專注於 Evoqua 的整合。我想你可以從結果中看到，我們在成本協同效應方面做得很好，他們追蹤得很好，而且在收入協同效應方面也做得很好。 Scott，在過去 18 個月裡，透過 Evoqua 的規劃和現在一年的執行，我們在併購方面累積了大量實力。因此，我們已經開始在組織中增強力量，這將有助於我們前進。

Maybe, the other thing I'd just reiterated that I said at Investor Day is that we've also put in place what I would call a strong bottoms-up process in our M&A kind of acquisition process to drive more consistent organic growth and deployment, and I think that's going to help us over the cycle. So obviously, we just laid out the three-year framework. It's not going to happen overnight, but I can tell you that we're very active, and we have a very strong pipeline that we're managing. And it aligns well to the value mapping that we just finished up.

也許，我剛才在投資者日上重申的另一件事是，我們還在併購類收購流程中實施了我所說的強大的自下而上流程，以推動更一致的有機增長和部署，我認為這將有助於我們度過這個週期。顯然，我們剛剛制定了三年框架。這不會在一夜之間發生，但我可以告訴你，我們非常活躍，我們正在管理一個非常強大的管道。它與我們剛剛完成的價值映射非常吻合。

So again, we're going to continue to run those targets through our decision criteria, that strategic fit. Financial has got to make sense. We're not going to do anything silly. And really, to your point, kind of organizational readiness, I think we're trending well. We've got good momentum and ready to execute our M&A pipeline.

因此，我們將繼續透過我們的決策標準（即策略契合度）來實現這些目標。金融必須有意義。我們不會做任何愚蠢的事情。事實上，就你的觀點而言，在組織準備方面，我認為我們的趨勢很好。我們勢頭良好，並準備好執行我們的併購管道。

Some of it is just timing, but it is an important piece as we outlined at Investor Day to our EPS growth at mid-teens over the cycle. So we're very active, but some of it's just timing, and we're still in early innings.

其中一些只是時機問題，但正如我們在投資者日所概述的那樣，這是我們在整個週期中每股收益成長的一個重要部分。所以我們非常活躍，但有些只是時機問題，而且我們還處於早期階段。

Good question -- good answer. Thank you. And guys, I don't -- I'm sure you don't want to give a lot of detail here, but you referenced a large project wins. I assume those are domestic. Are they related to mega projects? Can you give a little bit of color on kind of the scope and size historically versus how you kind of think about what large looks like? I mean, so many big semi plants, the stuff out there of scope that we've never seen before that I'd love to get a little color from you on those projects, if you can.

好問題——好答案。謝謝。夥計們，我不知道——我確信你們不想在這裡提供太多細節，但你們提到了一個大型項目的勝利。我猜這些都是國內的。它們與大型專案有關嗎？您能否對歷史上的範圍和規模以及您如何看待大型的情況進行一些說明？我的意思是，有這麼多大型半工廠，這些東西超出了我們以前從未見過的範圍，如果可以的話，我很想從你那裡得到一些關於這些項目的資訊。

Yeah. I think, back at Investor Day, we talked about data centers, that's starting to ramp up for us, and especially in our applied water business, but I think we're positioned uniquely too, Scott, and the fact that we also move water through pumping, we treat it, and then we also sense for it. So as we're winning these kind of data centers, we can offer a more turnkey solution, and we're kind of working at bottoms-up as well as some of the actual providers that are building the data centers themselves. So that's started to pick up some momentum. We had a nice win in applied water. We've had a couple actually, kind of at the $7 million to $10 million range, and so that's going well.

是的。我想，回到投資者日，我們討論了數據中心，這對我們來說開始增加，特別是在我們的應用水業務中，但我認為我們的定位也很獨特，斯科特，事實上我們也輸送水通過泵送，我們處理它，然後我們也感知它。因此，當我們贏得此類資料中心時，我們可以提供更多的交鑰匙解決方案，並且我們與一些正在建造資料中心的實際提供者一樣自下而上地工作。因此，這種勢頭開始增強。我們在施水方面取得了不錯的勝利。事實上，我們已經有幾個，價格在 700 萬美元到 1000 萬美元之間，所以進展順利。

Also, I'd say on the power transition, we highlighted a big win last quarter with green hydrogen. And so the water needed for that over a 20-year contract is big. We've got some other [wins] that have not kind of fit within the quarter that are in the pipeline that we've got a lot of momentum around as well around power.

另外，我想說的是，在電力轉型方面，我們強調了上季度綠氫的巨大勝利。因此，這份為期 20 年的合約所需的水量很大。我們還有一些其他[勝利]，這些勝利與本季不相符，但我們正在醞釀之中，我們在權力方面也有很大的動力。

And we see more and more consistency in the semiconductor space with microelectronics and the need for clean water, and a lot of these places have water scarcity issues. And so the water reuse is super important there. So I'd say that some of these kind of high-growth verticals, we're seeing momentum in big projects, and we don't see that slowing. We see it only continuing. And it will be a little lumpy within WSS specifically, but we see good momentum and a good pipeline.

我們看到半導體領域與微電子領域以及對清潔水的需求越來越一致，而其中許多地方都存在缺水問題。因此，水的回用在那裡非常重要。所以我想說，在一些高成長的垂直行業中，我們看到了大型專案的勢頭，而且我們沒有看到這種勢頭放緩。我們看到它只會繼續。特別是在 WSS 內部，它會有點不穩定，但我們看到了良好的動力和良好的管道。

Okay. Thank you. And congrats on first couple of quarters of the year here. Well done. I'll pass it on.

好的。謝謝。在此恭喜今年前幾季。做得好。我會把它傳遞下去。

Thank you.

謝謝。

Nathan Jones, Stifel.

內森瓊斯，斯蒂菲爾。

Good morning, everyone.

大家，早安。

Good morning.

早安.

I want to start off with some follow-up questions on MCS. Orders down in the quarter. I understand there's some lumpiness around that. But orders have been down, have declined a little bit in the last couple of years, burning off some backlog in '23 and '24. Maybe you could just talk about the visibility into the order pipeline that you have to see that turn around and start heading in the right direction to support growth.

我想先提出一些有關 MCS 的後續問題。本季訂單下降。我知道這周圍有些混亂。但訂單一直在下降，在過去幾年中略有下降，消耗了 23 年和 24 年的一些積壓訂單。也許您可以只談論訂單管道的可見性，您必須看到訂單管道的扭轉並開始朝著正確的方向前進以支持成長。

And with that, I know high-single digits to long-term kind of guidance here, but you are burning a fairly significant amount of backlog down in 2024. Should we expect the 2025 growth to be a little bit lower than the long-term average because you're comping against that backlog burn?

就這一點而言，我知道這裡的長期指導是高個位數，但你在 2024 年會消耗相當大量的積壓。要應付積壓的燒錢？

Yeah. I'd start us out here, and then maybe turn it over to Bill. Again, just a reminder, we're still in fairly early innings to mid-innings in AMI adoption, so there's a lot of runway out there. And although it doesn't always show up in orders, we do, obviously, put some of the orders in backlog and it's -- or some of the contracts in backlog and how they convert to orders can be a little lumpy. And just also a reminder that only 20% of that business is kind of big deals. 80% of it is book and ship or what we call flow.

是的。我會從這裡開始，然後也許會把它交給比爾。再次提醒一下，我們在 AMI 的採用方面仍處於相當早的階段到中期，所以還有很多跑道。儘管它並不總是出現在訂單中，但顯然，我們確實將一些訂單放入積壓訂單中，或者積壓中的一些合約以及它們如何轉換為訂單可能有點不穩定。也要提醒大家的是，只有 20% 的業務是大額交易。其中 80% 是預訂和出貨，或我們所說的流程。

But Nate, just looking at the pipeline that I see, we've got a lot of room for continued growth in that business, and we don't see it slowing down. It's just a matter of timing, more than anything.

但是內特，只要看看我看到的管道，我們在該業務上就有很大的持續成長空間，而且我們沒有看到它放緩。這只是一個時間問題，而不是任何事情。

Yeah. No, our expectation next year is that it will be in line with our long-term framework. It's just the backlog league to get us there. So maybe a little bit stronger before we get to kind of that high-single digits at some point in time next year.

是的。不，我們明年的期望是它將符合我們的長期框架。這只是積壓的聯盟讓我們到達那裡。因此，在明年某個時間點達到高個位數之前，可能會更強一些。

Yeah. And I think you had asked a few calls ago about where we are in past due. We expect to be almost complete with the past due backlog by the end of the year and probably wrap that up in Q1 of next year. So that burn is happening and obviously leading to the increased guide and M&CS revenue at the high-teens.

是的。我想你之前打過幾次電話詢問我們的逾期情況。我們預計到今年年底將幾乎完成逾期積壓，並可能在明年第一季完成。因此，這種燃燒正在發生，並且顯然導致了指南和 M&CS 收入的增加。

Second one I wanted to ask was on cash conversion. Obviously, the guidance has taken up to 120%. And I would think that 80/20 and the simplification initiatives should have an impact on working capital probably over the next at least couple of years that maybe drives cash conversion higher than the long-term average as you simplify the business, take inventory out, work on receivables and payables, and stuff like that. So any commentary you can give us on opportunities you're seeing in working capital as a result of these 80/20 and simplification initiatives? Thanks.

我想問的第二個問題是關於現金兌換。顯然，指引已經達到了120%。我認為 80/20 和簡化舉措應該會對未來至少幾年的營運資本產生影響，當你簡化業務、清空庫存時，這可能會推動現金轉換率高於長期平均水平，處理應收帳款和應付帳款之類的事情。那麼，對於您因這些 80/20 和簡化舉措而在營運資本方面看到的機會，您能給我們什麼評論嗎？謝謝。

Yeah. No, Nate, I think you're exactly right. That's a big part of the tool set as you start to reduce a lot of the complexity of the product portfolio. We get a lot more efficiency through just faster-moving inventory. Obviously, we reduced the complexity of a tremendous amount of long-tail customers, and your DSO improves from that perspective. So I totally agree, we'll see some benefits. The team does a phenomenal job right now with our overall cash conversion. But I think 80/20 will be able to take it to the next level.

是的。不，內特，我認為你是完全正確的。當您開始降低產品組合的複雜性時，這是工具集的重要組成部分。透過更快的庫存流動，我們獲得了更高的效率。顯然，我們降低了大量長尾客戶的複雜性，從這個角度來看，您的 DSO 得到了改善。所以我完全同意，我們會看到一些好處。該團隊目前在我們的整體現金轉換方面做得非常出色。但我認為 80/20 將能夠將其提升到一個新的水平。

But I think that will be on the back end of the P&L benefits that we get. So probably looking at as you get through the implementation, we said, hey, 12 to 18 months to realize the P&L benefits. It's probably in that 18 to 24 months. That's the second phase of simplification on the back end.

但我認為這將是我們獲得的損益收益的後端。因此，當您完成實施時，我們可能會說，嘿，需要 12 到 18 個月才能實現損益效益。大概就在那 18 到 24 個月內。這是後端簡化的第二階段。

Makes sense. Thanks very much for taking my questions.

說得通。非常感謝您回答我的問題。

Thanks, Nate.

謝謝，內特。

Joe Giordano, TD Cowen.

喬·佐丹奴，TD·考恩。

Hey, good morning, guys.

嘿，早上好，夥計們。

Good morning, Joe.

早安，喬。

Andrea, thanks for everything. You've been a huge help. If we -- if anything happens with water infrastructure, we'll now know who to blame on it.

安德里亞，謝謝你所做的一切。你給了我很大的幫助。如果我們——如果水利基礎設施發生任何事情，我們現在就會知道該歸咎於誰。

Thank you, Joe. It's been a pleasure.

謝謝你，喬。這是我的榮幸。

A lot of my questions have been asked already, but maybe if you could touch on -- since moving the service business and combining it with WSS, like, any like concrete kind of examples of how this is changing like conditions on the ground for you guys and leading to better results?

我的許多問題已經被問到了，但也許您可以談談——自從轉移服務業務並將其與 WSS 相結合以來，任何類似的具體示例，說明這種情況如何改變，例如您的實際情況夥計們並帶來更好的結果？

Yeah. I can start this out. I mean, I think that, obviously, we did it for a few reasons. One is to increase our synergies, because there is a lot of synergies when you now can move water and treat water. And so now, we're able to go in with the turnkey solution. We're already seeing probably that segment be the quickest to drive synergies, some of those we highlighted at the Investor Day.

是的。我可以開始這個。我的意思是，我認為顯然我們這樣做有幾個原因。一是增加我們的綜效，因為當你現在可以移動水和處理水時，會產生很多協同效應。現在，我們可以採用交鑰匙解決方案。我們已經看到該細分市場可能是最快推動協同效應的領域，其中一些是我們在投資者日強調的。

So also, I'd say just a common tool set. When you think about back office, we had two service companies. When we put the two companies together, the legacy Evoqua business was much more mature, had good processes and tools. And now, leveraging that across the entire services business has been a big help.

所以，我想說只是一個通用工具集。當你想到後台時，我們有兩家服務公司。當我們將兩家公司合併在一起時，傳統的 Evoqua 業務更加成熟，擁有良好的流程和工具。現在，在整個服務業務中利用這一點已經提供了很大的幫助。

And I think probably the biggest thing is, over time will be our technician utilization, being able to utilize technicians across the entire portfolio. Now, everybody is not completely [spongeable], but say, one-third to half of your technicians now can flex and do other types of work that they were doing before. And it also gives our aqua pros, as what we call them, a broader career path.

我認為最重要的事情可能是，隨著時間的推移，我們的技術人員利用率將會提高，能夠在整個產品組合中利用技術人員。現在，每個人都不是完全[海綿狀]，但是，三分之一到一半的技術人員現在可以靈活地完成他們以前所做的其他類型的工作。它也為我們所說的水上專業人士提供了更廣闊的職業道路。

So I'd say there's different aspects of how we're seeing it play out, but it's the fastest part of our revenue synergy right now, and it's working well.

所以我想說，我們看到它如何發揮作用有不同的方面，但這是我們目前收入協同效應最快的部分，而且運作良好。

If I can ask maybe you talked about data center and stuff like that. If I think about like the large project pipeline at WSS and maybe also like general industrial-type exposure to your infrastructure, are you seeing any bifurcation there? Because data center is definitely strong, but the commentary around large project activity in other sectors is kind of weakening. So curious if you're seeing like puts and takes in any of those businesses there?

如果我可以問的話，也許你談到了資料中心之類的東西。如果我考慮 WSS 的大型專案管道，也許也像一般工業類型的基礎設施暴露，您是否看到那裡有任何分歧？因為資料中心確實很強大，但圍繞其他行業大型專案活動的評論有點減弱。很好奇您是否看到了這些業務中的看跌期權和買入期權？

Not really. I mean, data centers that, I think, as I've mentioned, is not a huge part of our portfolio. It mainly shows up in applied water, although we've seen some synergies that we mentioned one of those in China at our Investor Day, but we've seen some other synergies where we're managing water at a data center as well as doing treatment. But it's not something that's going to be a big swing for us because it's not a large part of our business. But in general, we're seeing high-growth verticals like pharma, life sciences, microelectronics, power, continue to be really robust.

並不真地。我的意思是，正如我所提到的，我認為資料中心並不是我們產品組合的重要組成部分。它主要表現在應用水方面，儘管我們已經看到了一些協同效應，我們在投資者日提到了中國的協同效應之一，但我們也看到了一些其他協同效應，即我們在數據中心管理水以及做治療。但這對我們來說不會有很大的影響，因為它並不是我們業務的很大一部分。但總的來說，我們看到製藥、生命科學、微電子、電力等高成長垂直產業仍然非常強勁。

And now, look, no matter what regulations are, whatever is happening from that perspective, what's happening around climate and water scarcity is driving a lot of interest. I mean, we get -- I get phone calls all the time from leaders and CEOs in different parts of the world that are dealing with some real challenging stuff in terms of being able to keep their operations open or the quality of their water because of maybe saltwater intrusion dealing with a different type of water they're trying to treat. So we don't see any real slowdown. We are in really strong high-growth verticals, and data centers is one that's not big for us, but we're going to take advantage of it while it's hot.

現在，看看，無論法規是什麼，無論從這個角度來看發生了什麼，氣候和水資源短缺所發生的事情都引起了人們的極大興趣。我的意思是，我們經常接到來自世界各地的領導人和首席執行官的電話，他們正在處理一些真正具有挑戰性的問題，例如能否保持運營開放或水質問題，因為也許是鹹水入侵，正在處理他們試圖處理的不同類型的水。所以我們沒有看到任何真正的放緩。我們處於非常強大的高成長垂直行業，資料中心對我們來說並不大，但我們將趁熱時利用它。

Thanks, guys.

多謝你們。

Thank you.

謝謝。

Andrew Kaplowitz, Citigroup.

安德魯‧卡普洛維茨，花旗集團。

Good morning, everyone. Andrea, thanks so much for your help.

大家，早安。安德里亞，非常感謝你的幫忙。

Thank you, Andy.

謝謝你，安迪。

So Matt and Bill, you mentioned inflation in water infrastructure and margin in that segment after being up nicely in Q1, year over year was down a bit in Q2. I know you said that acquisition, that was acquisition related. But could you give more color into what you're seeing on the price versus cost side, particularly in that segment. Did anything materially change or is it just lumpiness? And we know you have some China exposure in there. So maybe you could talk about the competitive environment in China.

馬特和比爾，你們提到了水利基礎設施的通貨膨脹以及該領域的利潤率在第一季度大幅上升後，在第二季度同比略有下降。我知道你說的是收購，那是與收購相關的。但是您能否對您在價格與成本方面看到的情況提供更多的信息，特別是在該細分市場中。有什麼實質的改變嗎？我們知道您在那裡有一些中國業務。也許你可以談談中國的競爭環境。

Price cost was positive there. I think, the biggest impact, and that's why we highlighted just the acquisition element second quarter last year, during the short time that APT was part of that segment. It had unusually high margin, it was in the low-20s versus its normalized rate of kind of the teens, so that was the biggest difference. That's why we added in the pro forma margin expansion, 40 bps, and just it was at 40% pro forma incremental. So fundamentally, the profit there is still strong. It sequentially improved. We expect it to continue to sequentially improve as we progress through the back half and have year-over-year margin expansion.

那裡的價格成本是正的。我認為影響最大，這就是為什麼我們去年第二季只強調收購因素，當時 APT 是該細分市場的一部分。它的利潤率異常高，與正常水平的十幾歲相比，它的利潤率只有二十多歲，所以這是最大的區別。這就是為什麼我們在預期利潤率擴張中增加了 40 個基點，預計增量為 40%。所以從根本上來說，那裡的利潤仍然強勁。就逐漸好轉了。我們預計，隨著下半年的進展，其利潤率將繼續持續改善，並實現年比利潤率擴張。

I would say, from a water infrastructure perspective, they do have probably the largest piece of our China exposure. China has been a little bit lumpy for us. It's -- actually, the first half has been positive from a revenue perspective. Orders were down, but we see kind of some of the larger projects, especially within treatment continue to get delayed just as, I think China is trying to figure out the overall economic situation and how they're going to fund several things across their investment framework. So that's probably the one area we kind of are continuing to keep our eye on as things just seem to be perpetually shifting to the right.

我想說，從水基礎設施的角度來看，他們確實可能擁有我們在中國業務中最大的部分。中國對我們來說有點不穩定。事實上，從收入的角度來看，上半年是正面的。訂單減少了，但我們看到一些較大的項目，特別是治療方面的項目繼續被推遲，正如我認為中國正在試圖弄清楚整體經濟形勢以及他們將如何為投資中的幾件事提供資金框架。因此，這可能是我們繼續關注的一個領域，因為事情似乎永遠向右轉變。

Very helpful. And then just maybe focusing a little more on applied water orders, as you said, look good. They were from long-cycle projects. Maybe talk about the short-cycle market as you see it. Is the business kind of bouncing along the bottom? What's the channel telling you?

很有幫助。然後也許更多地關注應用的水訂單，正如你所說，看起來不錯。它們來自長週期項目。也許談談你所看到的短週期市場。業務是否正在觸底？頻道告訴你什麼？

And you obviously mentioned the easier comparison in the second half of the year. So I know you talked about applied water returning growth in '25, but can they do that before the end of the year?

您顯然提到了下半年比較容易的情況。所以我知道你在 25 年談到了施水恢復生長，但他們能在今年年底之前做到這一點嗎？

Yeah. I think, third quarter is still down low-single digits. Fourth quarter, it's probably closer to zero. Again, it's relatively in line. I mean, sequentially, the dollar amounts. The decline is largely seen in developed markets and primarily in our commercial and industrial space.

是的。我認為，第三季仍呈現低個位數下降。第四季度，它可能接近零。再次，它是相對一致的。我的意思是，按順序，美元金額。這種下降主要出現在已開發市場，尤其是我們的商業和工業領域。

Again, from a macro perspective, the institutional ABI has been negative for 16 consecutive months. We continue to see manufacturing PMI, which are good indicators for us for that business. But I give the teams a lot of credit. Matthew highlighted, they're making their own luck. They're leveraging their differentiated technology to win some of these larger projects to get back on a growth track into next year.

再次，從宏觀角度看，機構ABI已連續16個月為負。我們繼續看到製造業 PMI，這對我們來說是該業務的良好指標。但我對團隊給予了很大的信任。馬修強調，他們正在創造自己的運氣。他們正在利用自己的差異化技術贏得一些較大的項目，以便在明年重新回到成長軌道。

Appreciate all the color.

欣賞所有的顏色。

Thanks, Andy.

謝謝，安迪。

Bryan Blair, Oppenheimer.

布萊恩布萊爾，奧本海默。

Thank you. Good morning, everyone. Andrea, thank you very much for all your help.

謝謝。大家，早安。安德里亞，非常感謝你的幫忙。

Good morning.

早安.

Thank you, Bryan.

謝謝你，布萊恩。

Very solid quarter. And MCS, again, MCS margin again stood out. I'm sorry if I missed this detail, but Bill, you have called out, you've been very upfront about there being some mix headwinds going into the back half with energy deployments. Are you willing to size that sequential headwind relative to the strength of 1H?

非常穩定的季度。 MCS 的利潤率再次脫穎而出。如果我錯過了這個細節，我很抱歉，但是比爾，你已經大聲疾呼，你非常坦率地指出後半段的能源部署會遇到一些混合阻力。您願意根據 1H 的強度來衡量連續逆風的大小嗎？

Yeah. I mean, we think it could be around 100 basis points in the back-half sequential decrease from where we finished the first half.

是的。我的意思是，我們認為後半段的連續下降可能比上半段結束時下降了 100 個基點左右。

Okay, understood. Appreciate that. I was hoping you offer a little more color on how treatment orders pace through the quarter. I think you cited around 20% growth there, so very robust for a business that tends to be a leading indicator. Any meaningful differences by region that you would call out? And how does treatment momentum influence your team's confidence in the back-half outlook?

好的，明白了。感謝。我希望您能就本季的治療訂單進度提供更多資訊。我認為您提到了 20% 左右的成長，對於一個往往成為領先指標的企業來說非常強勁。您認為各地區有什麼有意義的差異嗎？治療動能如何影響您的團隊對後半場前景的信心？

Yeah, we've seen -- this is Matthew, Bryan. We've seen really good momentum in treatment across all regions. Like you said, we're up roughly 22% for the entire business and probably led by the US and emerging markets.

是的，我們已經看到了——這是馬修，布萊恩。我們看到所有地區的治療勢頭都非常好。正如您所說，我們整個業務成長了約 22%，其中美國和新興市場的成長可能最為領先。

In China, as Bill pointed out, it's been a little bit weak. And actually, that was a little bit of bright spot on orders themselves. We were up slightly low-single digits in China on treatment.

正如比爾指出的那樣，在中國，情況有點薄弱。事實上，這就是訂單本身的一點亮點。我們在中國的治療率略有上升，為低個位數。

So all in all, it's a really good indicator that capital continues to flow, the funding. We see capital investment continuing and good momentum for treatment, which is a big part of not only water quality, but also scarcity of water. So we see those trends continuing.

總而言之，這是一個很好的指標，顯示資金繼續流動。我們看到資本投資持續存在，處理方面勢頭良好，這不僅是水質的重要組成部分，也是水資源短缺的一個重要組成部分。所以我們看到這些趨勢仍在繼續。

[Very good]. Thank you again.

[非常好]。再次感謝你。

Thank you.

謝謝。

And this concludes the Q2 earnings call. I would like to turn it back to Matthew Pine for any closing remarks.

第二季財報電話會議到此結束。我想請馬修·派恩發表結束語。

Thank you. We'll wrap it there. Thanks for your questions, and thanks for everyone who joined today. As always, we appreciate your interest in Xylem, and all the very best.

謝謝。我們會把它包在那裡。感謝您的提問，也感謝今天加入的所有人。一如既往，我們感謝您對賽萊默的關注，祝您一切順利。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.

會議現已結束。感謝您參加今天的演講。此時您可以斷開線路。