At its Analyst & Investor Day in New York City, Xylem Inc. outlined its five-year strategy to drive profitable growth. Xylem President and CEO Patrick Decker provided an overview of the company’s plans to drive above-market organic growth and its balanced capital deployment strategy, which includes accelerated acquisition activity. Other members of Xylem’s senior leadership also presented at the event.
“Xylem has a powerful arsenal to fuel our growth and create value for our shareholders,” Decker said. “First, the combination of improving end-market conditions and diligent execution will enable us to deliver faster than market growth. Second, we expect to further expand operating margins by more than 300 basis points over the next five years through focused business simplification and continuous improvement initiatives. And finally, we plan to execute a balanced capital deployment strategy. With strong cash flow and a solid capital structure, we expect to deploy up to $3.5 billion for disciplined M&A and opportunistic share repurchases over the plan period.”
Xylem also reaffirmed its full-year outlook, including full-year 2015 revenue of approximately $3.7 billion, a decrease of six to seven percent from the full-year 2014 results. On an organic basis, Xylem expects to generate revenue growth of approximately 1% to 2%.
Full-year 2015 adjusted operating income is expected to be in the range of $470 million to $483 million, resulting in adjusted earnings per share of $1.82 to $1.87. Excluding the projected unfavorable impact of foreign exchange translation, Xylem’s adjusted earnings per share growth expectations are in the range of four to seven percent over the comparable full-year 2014 results. The company’s outlook for projected restructuring and realignment costs of $20 million for the year is unchanged.
Source: Xylem Inc.
