Xylem Inc.

Welcome to Xylem's second quarter 2023 earnings conference call. At this time, all participants have been placed on a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star 2. So others can hear your questions clearly, We ask that you pick up your handset for best sound quality. Lastly, if you should require operator assistance, please press star zero. I would now like to turn the call over to Andrea Vanderberg, Vice President of Investor Relations.

Thank you, Operator. Good morning, everyone, and welcome to Xylem's second 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 perspectives on Xylem's second quarter 2023 results and discuss the third quarter and full year outlook. 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. 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, August 9th. Please note the replay number, plus 1-800-839-1320 or plus 1-402-220-0488. Additionally, the call will be available for playback via an investor section of our website under the heading Investor Events. Please turn to slide two. 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 that reflect subsequent events or circumstances. And actual events or results could differ materially from those anticipated. Please turn to slide three. 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. And non-GAAP financials have been reconciled for you and are included in the appendix section of the presentation. Now, please turn to slide four, and I'll turn the call over to our CEO, Patrick Decker.

Thanks, Andrea, and good morning, everyone. Today is a significant milestone for Xylem as we have the pleasure to present the performance and outlook of quite a different company than just a quarter ago as we describe our ability to make an impact on the world as society deals with growing water challenges. The combination of Xylem and Avoqua has already begun taking shape as an even stronger global platform that will have a profoundly positive impact on our customers and communities. We have a responsibility in front of us to help at exactly the moment when the world's water challenges are coming into more acute focus than ever. When we completed the acquisition in May, our capability to meet this moment expanded along with our opportunities for growth. Now, 10 weeks into the integration of these two great enterprises, we are even more confident about the value we will create with our combined company. There are three things that underpin that confidence. First, the team is delivering impressive performance across both companies. I am so very proud of our teams for staying focused on serving our customers at a potentially distracting time. Each team, both Legacy Xylem and Avoqua, turned in a quarter significantly exceeding expectations and giving us brisk momentum for the future. Second, Our early progress on integration has increased our confidence in the cost synergies we previously laid out and the growth synergies ahead of us. We have moved well forward on both sources of value. And third, as water challenges continue to intensify for our customers across many parts of our economy and society, they are seeking simpler, more affordable ways to tackle them. Well, we are now even more strongly positioned to solve those needs and capture that demand with increased exposure to attractive, durable end markets. We'll come back to these bigger points in a few minutes, but I want to make sure we also give appropriate attention to the very strong quarter we just closed. As we shared in our press release this morning, we significantly exceeded expectations on revenue growth, margin, and earnings per share. Organic revenue growth was 15%, with total reported revenue growth of 26%. EPS was up 32% and grew 28% excluding the impact of the acquisition. And we delivered EBITDA margin well above our guide at more than 19%. It was driven by strong demand and the team's continued focus on pricing as well as ongoing continuous improvement aimed at simplifying how we serve our customers. Organically, all segments contributed double-digit revenue growth in all end markets. And each of our regions grew, led by notably strong pace in the U.S. and a solid recovery in China. Our legacy backlog was up 7%. And then we added Avoqua's backlog of more than a billion dollars, and the two together bring our total backlog to $5.3 billion. While we have a lot to do with the integration of these two great companies, we have strong commercial momentum, which gives us the confidence to raise our guidance for the year. And again, I want to thank every one of our team members around the world and our partners for what they are doing every day to deliver real impact to our customers and our communities. In a moment, we'll get more color on our outlook as well as detail on our end markets and regions. But first, I'm going to hand it over to Sandy to dig into the quarter strong results.