Xylem announced a planned realignment of its reportable segments to reflect the operating drivers of financial performance with greater transparency.
The change is driven by the integration of the Evoqua acquisition completed earlier this year. Effective January 1, 2024, the new segment, Water Solutions and Services (WSS), will unify Evoqua’s legacy Integrated Solutions and Services (ISS) segment with Xylem’s legacy dewatering and assessment services businesses.
In May 2023, Xylem acquired Evoqua to create the world’s most advanced platform of capabilities to address customers’ and communities’ mission-critical water needs. In the process of integrating the two companies, opportunities emerged to accelerate synergy capture by bringing multiple services offerings together in a single segment. With this realignment, WSS will comprise ISS, Xylem’s dewatering business, previously part of the Water Infrastructure segment, and the assessment services business, previously part of the Measurement and Control Solutions segment. WSS will deliver a greater breadth of services at scale and enable the Company’s service force to address a variety of customer challenges with a unified customer experience.
“Our combination with Evoqua positions Xylem to address even more of the complex challenges our customers face,” said Matthew Pine, Xylem’s Chief Operating Officer and incoming CEO. “We have already seen strong synergies by combining our go-to-market strategies across businesses. This new segment is a natural next step to accelerate integration, scale our service capabilities and drive shareholder value as we bring the full power of this platform to bear for our customers.”
For fiscal 2024, the approximate proportion of total revenue per business segment is expected to be Water Solutions and Services (30%), Measurement and Control Solutions (20%), Water Infrastructure (30%), and Applied Water (20%).
Xylem will discuss the new segment during its fourth quarter and full-year earnings conference call on February 6. For information purposes and to provide investors with historical information on a basis consistent with its new reporting structure, Xylem will provide certain recast financial information for affected reportable segments following the filing of its 2023 Annual Report on Form 10-K.
Source: Xylem Inc.
