UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 30, 2012

XYLEM INC.
(Exact name of registrant as specified in its charter)

 
 	 	 	 	 	
Indiana	 	001-35229	 	45-2080495	
(State or other jurisdiction
of incorporation)	 	(Commission
File Number)	 	(IRS Employer
Identification No.)	

1133 Westchester Avenue, Suite N200
White Plains, New York	 	10604	
(Address of principal executive offices)	 	(Zip Code)	
(914) 323-5700
(Registrant’s telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Item 7.01	Regulation FD Disclosure	
The following information is furnished pursuant to Item 7.01 Regulation FD Disclosure. This information shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. Company executives will present an overview of the Company at the KeyBanc Capital Markets Industrial, Automotive and Transportation Conference on May 30, 2012. The presentation slides will be posted on the Company’s website and are attached and incorporated herein by reference as Exhibit 99.1.
Caution Concerning Forward Looking Statements
This document contains information that may constitute “forward-looking statements.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Generally, the words “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “target” and similar expressions identify forward-looking statements, which generally are not historical in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking.
These forward-looking statements include, but are not limited to, statements about the separation of Xylem Inc. (the “Company”) from ITT Corporation, the terms and the effect of the separation, the nature and impact of the separation, capitalization of the Company, future strategic plans and other statements that describe the Company’s business strategy, outlook, objectives, plans, intentions or goals, and any discussion of future operating or financial performance. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future — including statements relating to orders, sales, operating margins and earnings per share growth, and statements expressing general views about future operating results — are forward-looking statements.
Caution should be taken not to place undue reliance on any such forward-looking statements because they involve risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in, or reasonably inferred from, such statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the Company’s historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those set forth in Item 1A of our Annual Report on Form 10-K, and those described from time to time in subsequent reports filed with the Securities and Exchange Commission.
 
Item 9.01	Financial Statements and Exhibits.	
(d) Exhibits.

Exhibit No.	  	Description	
 	 	
99.1	  	Presentation slides posted by Xylem Inc. on May 30, 2012.	

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 	 	 	 	XYLEM INC.	
 	 	 	 	 	
Date: May 30, 2012	 	 	 	By:	 	/s/ Frank R. Jimenez	 	 	
 	 	 	 	 	 	Frank R. Jimenez	 	 	
 	 	 	 	 	 	Senior Vice President, General Counsel and
Corporate Secretary
(Authorized Officer of Registrant)	 	 	

EXHIBIT INDEX

Exhibit No.	 	Description	
 	 	
99.1	 	Presentation slides posted by Xylem Inc. on May 30, 2012.	

KeyBanc Capital Markets Industrial,Automotive, & Transportation ConferenceMay 30, 2012Exhibit 99.1

Forward Looking Statements2This document contains information that may constitute “forward-looking statements.” Forward-looking statements bytheir nature address matters that are, to different degrees, uncertain. Generally, the words “anticipate,” “estimate,”“expect,” “project,” “intend,” “plan,” “believe,” “target” and similar expressions identify forward-looking statements, whichgenerally are not historical in nature. However, the absence of these words or similar expressions does not mean that astatement is not forward-looking. These forward-looking statements include, but are not limited to, statements about the separation of Xylem Inc. (the“Company”) from ITT Corporation, the terms and the effect of the separation, the nature and impact of the separation,capitalization of the Company, future strategic plans and other statements that describe the Company’s businessstrategy, outlook, objectives, plans, intentions or goals, and any discussion of future operating or financial performance.All statements that address operating performance, events or developments that we expect or anticipate will occur inthe future — including statements relating to orders, revenues, operating margins and earnings per share growth, andstatements expressing general views about future operating results — are forward-looking statements.  Caution should be taken not to place undue reliance on any such forward-looking statements because they involverisks, uncertainties and other factors that could cause actual results to differ materially from those expressed or impliedin, or reasonably inferred from, such statements.  The Company undertakes no obligation to publicly update or reviseany forward-looking statements, whether as a result of new information, future events or otherwise, except as requiredby law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actualresults to differ materially from the Company’s historical experience and our present expectations or projections. Theserisks and uncertainties include, but are not limited to, those set forth in Item 1A of our Annual Report on Form 10-K, andthose described from time to time in subsequent reports filed with the Securities and Exchange Commission.

•Design, Manufacture, & Service Highly Engineered Technologies•A True Water Pure Play•Diverse End Market & Geographic Mix•Leading Brands & Large Installed Base•Unrivaled Global Reach …Serving 150+ CountriesGlobal Leader in WaterApplication Solutions3$3.8B Company Uniquely Positioned in the Attractive Water Industry$3.8B Company Uniquely Positioned in the Attractive Water Industry

Where do we play in the $500B Global Water Industry?Public Utility~250,000UtilitiesGloballyWater Infrastructure~5%-10% EBITMarginDesign& Build~8,000 EPCFirms Globally~2%-5%EBITMarginEquipment &Equipment &ServicesServices~20,000~20,000CompaniesCompaniesGloballyGlobally~5%-20+% EBITMargin$280B$280BEnd UseApplicationsFarms, PowerPlants, HomesApplied Water$220BSource: GWI, Company Estimates$250B$250BPredominately Commodity-likeEquipment & Service•Pipes, valves, fittings and low value pumps•Low-value services•Low or no differentiation•Generally either capital or labor intensive•Generally single-digit margins…somepockets of higher profitability$30B$30BXylem FocusXylem Focus4Xylem Focused on Attractive End-Markets in Equipment & ServicesXylem Focused on Attractive End-Markets in Equipment & ServicesTechnology Intensive•Higher value equipment-Energy efficiency, performin harsh conditions, high reliability•Knowledge-based services-Analytics, energy audits•Differentiated solutions•~10-20%+ margins

How Does Xylem Create Value?5By Partnering with Our Customers to Solve Water ChallengesBy Partnering with Our Customers to Solve Water Challenges••Depleting Water SupplyDepleting Water Supply••Tightening RegulationTightening Regulation••Aging InfrastructureAging Infrastructure••Population GrowthPopulation Growth••UrbanizationUrbanization••Sustainability / Energy EfficiencySustainability / Energy Efficiency••Fragmented IndustryFragmented Industry••Geographically DiverseGeographically Diverse••Attractive End MarketsAttractive End Markets••Installed Base ImportanceInstalled Base Importance••Customer Reliance on ExpertiseCustomer Reliance on ExpertiseUnderstanding Global Water ChallengesLeading Within theGlobal Water IndustryUniqueAssetsKeyPartnersIndustryRelationsInnovativeSolutions

6……With Attractive Growth Rates and Strong FundamentalsWith Attractive Growth Rates and Strong FundamentalsBalanced Portfolio …Diversified Market ExposureEurope37%U.S.36%Asia Pac11%Other16%End Market Mix*End Market Mix*Geographical Mix*Geographical Mix*Industrial40%Public Utility36%Commercial12%Residential9%Agricultural3%XylemXylemEmergingEmergingMarket RevenueMarket Revenue= 19% in 2011= 19% in 2011*2011 RevenuesEnd MarketEnd MarketCycleCycleFundamentalsFundamentalsIndustrialLessCyclical/Late Cycle•Critical products•Strong aftermarket &replacementPublicUtilityNon-Cyclical•Tariffs protected &growing•~70% for O&M activity•Strong aftermarket &replacementCommercialLate Cycle•Strong replacement•Green regulationResidentialEarlyCycle•Strong replacement•Energy efficiencyAgricultureMid Cycle•Growing demandBalanced End MarketBalanced End MarketMkt Growth Rates’10 -’15Developed 1 -3%Emerging   8 -10+%Global3 -5%

Dewatering and IndustrialWater Applications7Dewatering ApplicationsDewatering ApplicationsIndustrial Water ApplicationsIndustrial Water ApplicationsDiverse Applications•Construction•Disaster Recovery•Environmental•Heavy IndustryDiverse ApplicationsDiverse Applications••ConstructionConstruction••Disaster RecoveryDisaster Recovery••EnvironmentalEnvironmental••Heavy IndustryHeavy Industry•Mining•Oil, Gas & Chemical•Water&WasteWater•Marine••MiningMining••Oil, Gas & ChemicalOil, Gas & Chemical••WaterWater&&WasteWasteWaterWater••MarineMarineHeatingCoolingPressureBoostingWaste WaterRemoval

Public Utility & IndustrialTransport, Treatment & Test8Application Technologies•Waste Water Transport•Filtration•Biological Treatment•UV & Ozone Disinfection•Analytical InstrumentationApplication TechnologiesApplication Technologies••Waste Water TransportWaste Water Transport••FiltrationFiltration••Biological TreatmentBiological Treatment••UV & Ozone DisinfectionUV & Ozone Disinfection••Analytical InstrumentationAnalytical Instrumentation

Commercial & Residential9Customers•Developers•Building Operators•Building Designers•HVAC Specialists•Contractors•PlumbersHVAC  -HeatingPressure boostersFire protectionHVAC  -CoolingWastewaterZone Control

A Unique Spectrum of Applications Expertise10Source: Citi Investment Research and Xylem Company EstimatesA Genuine Water Company With the Broadest Portfolio* 2011 Revenues46*11%*6%*19%*15%*3%*Water InfrastructureApplied WaterWater as %of Total RevsTransportTreatmentTestBuildingServicesIndustrialWaterIrrigationXylem>90%Danaher~15%Franklin~85%Grundfos~85%KSB~25%Pentair~50%Siemens~5%Sulzer (ABS)~50%Thermo~5%Wilo~30%

Xylem Has a Focused Growth Strategy•Replicate leadership positions•Leverage brands with globalpartners•Strong aftermarket opportunities•Innovative application solutions•Sustainable infrastructureinitiativesXylem Target Organic Growth ~ 2 points Faster Than Market•Established footprint•Localized innovation centers•Partnerships with leading, globalwater companies•Focused BRIC & ROW Strategy•Disciplined approach•Build upon Dewatering andAnalytics acquisition platforms•Dewatering & Analytics•History of successful integration•Bolt-on, niche go-forward strategy11Organic GrowthOrganic GrowthEmerging MarketsEmerging MarketsAcquisition StrategyAcquisition Strategy

12Highly Attractive Recurring Revenue Profile•Approximately 22% of Xylem revenue•Installed base drives replacement sales•Brand loyalty drives like-for-likereplacement•Installed base provides opportunity forupgrades, next generation and servicesParts & ServiceReplacement Equipment(1)$MNote:(1) Based on company estimates.Aftermarket Provides Stability and Drives Strong Profitable GrowthAftermarket Parts & Services Revenues200620072008200920102011$370$382$396$433$512$570•15% of Xylem revenue •Strong global presence•120+ owned service centers•600+ service employees•Extensive channel partner network•9% Revenue CAGR ‘06-’11 despiteeconomic downturn•~11% revenue growth 2010-2011

Strong Growth in Revenue and Profitability13Revenues ($M)Revenues ($M)OperatingOperatingIncomeIncome&&Margin*Margin*($M)($M)Op Margin expands 310 bps•Operational & Commercial Excellence Initiatives•Price & Productivity more than offset inflation•Includes restructuring costs $41M, $31M,and $15M (’08 -‘10)Demonstrated Record of Growing Revenue and ProfitabilityDemonstrated Record of Growing Revenue and ProfitabilityEBITDA*$384$356$489$637EBITDA %*11.7%12.5%15.3%16.7%Earnings Per Share*Earnings Per Share*Organic-8.8%                  3.4%                  7.1%Growth** See non-GAAP reconciliations.$315$276$388$4829.6%9.7%12.1%12.7%2008200920102011$3,291$2,849$3,202$3,80320082009201020112008200920102011$1.22$1.10$1.55$1.93EPSCAGRof16.5%(’08–’11)

Xylem Segment OverviewMarket Size: $16B2011 Revenues:  $2.4B2011 Op Margin*: 14.9%WaterInfrastructure63%Water Infrastructure OverviewWater Infrastructure OverviewApplied Water37%Market Size: $14B2011 Revenues:  $1.4B 2011 Op Margin*: 12.0%CustomersResidential & Commercial,Industrial Facilities, AgricultureApplied Water OverviewApplied Water OverviewCustomersPublic UtilitiesIndustrial FacilitiesDistributionWorld-Class Global Direct (~70%)& Indirect ChannelsNote: (1) Global market share based on company estimates.DistributionPrimarily through World-ClassIndirect (+70%) Channels14*Excluding separation costs of $16M*Excluding separation costs of $13MRevenue byApplicationMarketShare(1)Treatment18%#1Test9%#2Transport73%#1Revenue byApplicationMarketShare(1)Bldg. Services53%#2Industrial Water18%#2Irrigation9%#3UniquePosition-OnlyProviderofAllThree“T’s”Large Installed Base, Growth Despite Slow NewConstruction

Gross Margin Improvement Funds Future GrowthXylem Continues to Invest While Increasing ProfitabilityXylem Continues to Invest While Increasing Profitability15•Operational and Commercial excellence•Growth in higher margin Analytics and Dewatering applications•Xylem’s Water Infrastructure direct sales force a key competitive advantage32.0%33.0%34.0%35.0%36.0%37.0%38.0%39.0%200820092010201134.7%36.4%37.9%38.4%0.0%0.5%1.0%1.5%2.0%2.5%3.0%20082009201020111.9%2.2%2.3%2.6%R&D12.8%14.8%16.8%18.8%20.8%22.8%24.8%200820092010201121.9%23.4%23.0%23.1%SG&AGross Margin

Free Cash FlowFree Cash Flow1*1*and Conversion ($M)and Conversion ($M)Focused on Free Cash Flow161FreeCashFlow=Netcashfromoperatingactivities-CapitalexpendituresStrongFreeCashFlow&SolidBalanceSheettoFundGrowthInitiativesCapital Structure & Liquidity PositionCapital Structure & Liquidity PositionMarch 31, 2012Cash347Debt1,206Net Debt859Shareholders’Equity1,949Net Capital2,808Net Debt to Net Capital31%•Strong Cash Position•No Significant Debt Maturities Until 2016•31% Net Debt to Net Capital•1.3x Net Debt/Adj. TTM EBITDA•$600M Revolving Credit Facility Undrawn•Access to Commercial Paper* See non-GAAP reconciliations.$341$308$301$388152%117%91%111%2008200920102011

Disciplined Capital Deployment17•2.5% –3.5% of sales•~$0.10/share•In-line with peers•Up to $300M / yearCapital Deployment Strategy•Balance of organic & inorganic investment•Return value to shareholders•Maintain solid investment grade metrics•Debt & pensionOrganic GrowthWorld Class FacilitiesCash return toshareholdersCash to meet keyobligationsInorganic investmentto fuel growthCapital Deployment Evaluation•Fold targeted performance into Operating plans•Quarterly / Annual investment review•Ensure targeted returns achievedFocused on LT Shareholder ReturnsCash fromOperationsCapexReturn toShareholdersFinancialObligationsAcquisitionStrategy

Financial Projections18•Market growth of 3-5%...4-6% Xylem targeted growth•Acquisition strategy adds 1-2 % points of growth•Emerging markets > 20% of revenuesXylem is poised to achieve our long-term financial objectives•Operational & Commercial excellence expand segment margins 50-75 bps per year–Gross margin > 40%•Continued cash management discipline to achieve cash conversion of ~100%•Capital deployment strategy to drive ROIC2012 Guidance2015 TargetRevenues$3.9B to $4.0B$4.5B to $5.0BOperating Margin*12.7% to 13.3%14.5% to 15.5%Free Cash Flow Conversion95%100%EPS Growth*+8% to +17%* See non-GAAP reconciliations.Long-Term Targets

19Q&AQ&A

Investment Highlights20•UniquelyPositioned…GloballeaderinAttractiveWaterIndustry•BalancedPortfolio…DiversifiedEnd&GeographicMarketMix•LargeInstalledBase…Stability,ProfitableAftermarketGrowth•AttractiveGrowthOpportunities…Organic&Inorganic•IncreasingProfitability…ProvenTrackRecord,ContinuedFocus•SolidCashFlowGeneration…FundsGrowthandShareholderReturnsAbility to Deliver Strong & Consistent Financial PerformanceAbility to Deliver Strong & Consistent Financial Performance

21Thank you for your interest !Thank you for your interest !NYSE: XYLhttp://investors.xyleminc.comPhil De Sousa, Investor Relations Officer(914) 323-5930(914) 323-5931Janice Tedesco, Investor Relations Coordinator

Appendix

Non-GAAP Reconciliation: Organic Revenue23(A)(B)(C)(D)(E)(F) = B+C+D+E(G) = F/AChange% ChangeChange% ChangeRevenueRevenue2011 v. 20102011 v. 2010FX ContributionEliminationsAdj. 2011 v. 2010Adj. 2011 v. 201020112010Year Ended December 31, 2011Xylem Inc.3,8033,20260118.8%(264)(111)-2267.1%Water infrastructure2,4161,93048625.2%(264)(87)21377.1%Applied Water1,4441,3271178.8%-(28)(1)886.6%Change% ChangeChange% ChangeRevenueRevenue2010 v. 20092010 v. 2009FX ContributionEliminationsAdj. 2010 v. 2009Adj. 2010 v. 200920102009Year Ended December 31, 2010Xylem Inc.3,2022,84935312.4%(263)6-963.4%Water Infrastructure1,9301,65127916.9%(247)(8)-241.5%Applied Water1,3271,254735.8%(16)16-735.8%Change% ChangeChange% ChangeRevenueRevenue2009 v. 20082009 v. 2008FX ContributionEliminationsAdj. 2009 v. 2008Adj. 2009 v. 200820092008Year Ended December 31, 2009Xylem Inc.2,8493,291(442)-13.4%(7)158-(291)-8.8%Water infrastructure1,6511,824(173)-9.5%-108-(65)-3.6%Applied Water1,2541,527(273)-17.9%(7)53-(227)-14.9%Acquisitions /DivestituresAcquisitions /DivestituresXylem Inc. Non-GAAP ReconciliationReported vs. Organic Revenue($ Millions)(As Reported -GAAP)(As Adjusted -Organic)Acquisitions /Divestitures

Non-GAAP Reconciliation: EBITDA24Xylem Inc. Non-GAAP ReconciliationNet Cash - Operating Activities vs. Free Cash FlowYears ended 2011, 2010, 2009, & 2008($ Millions)Year Ended2011201020092008Net Cash - Operating Activities449                     395                 370408Capital Expenditures(126)                    (94)                  (62)                  (67)                  Free Cash Flow, including separation costs323                     301                 308341Separation Costs (Cash Paid incl. Capex)65                        -                  -                  -                  Free Cash Flow, excluding separation costs388                     301                 308                 341                 Net Income279329263224Separation Costs, net of tax72-                  -                  -                  Adjusted Net Income351329263224Free Cash Flow Conversion111%91%117%152%

Non-GAAP Reconciliation: Earnings Per Share25FY 2009FY 2010FY 2011Net Income263                329                279                Separation costs, net of tax--72                  Adjusted Net Income before Special Tax Items263                329                351                Special Tax Items(61)                 (43)                 7                    Adjusted Net Income202                286                358                Diluted Earnings per Share$1.42$1.78$1.50Separation costs per Share--$0.39Adjusted diluted EPS before Special Tax Items$1.42$1.78$1.89Special Tax Items per Share($0.32)($0.23)$0.04Adjusted diluted EPS$1.10$1.55$1.93Xylem Inc. Non-GAAP ReconciliationAdjusted Diluted EPS2009, 2010, & 2011($ Millions, except per share amounts)

Non-GAAP Reconciliation: Free Cash Flow26Xylem Inc. Non-GAAP ReconciliationNet Cash -Operating Activities vs. Free Cash FlowYears ended 2011, 2010, 2009, & 2008($ Millions)Year Ended2011201020092008Net Cash -Operating Activities449395370408Capital Expenditures(126)(94)(62)(67)Free Cash Flow, including separation costs323301308341Separation Costs (Cash Paid incl. Capex)65---Free Cash Flow, excluding separation costs388301308341Net Income279329263224Separation Costs, net of tax72---Adjusted Net Income351329263224Free Cash Flow Conversion111%91%117%152%

Non-GAAP Reconciliation: Guidance27Illustration of Mid Point Guidance2012 GuidanceFY '11FY '12As ReportedAdjustmentsAdjustedAdjustmentsNormalizedAs ReportedAdjustmentsAdjustedTotal Revenue3,8033,8033,8033,9503,950Segment Operating Income50329a532(8)d5245778h585Segment Operating Margin13.2%14.0%13.8%14.6%14.8%Corporate Expense108(58)b5020e7081(10)h71Operating Income39587482(28)45449618514Operating Margin10.4%12.7%11.9%12.6%13.0%Interest Expense(17)(17)(39)f(56)(51)(51)Other Non-Operating Income (Expense)555--Income before Taxes38387470(67)40344518463Provision for Income Taxes(104)(7)c(111)16g(95)(111)(5)i(116)Net Income27980359(51)30833413347Diluted Shares (j)185.3185.3185.9185.9Diluted EPS1.50$             0.43$              1.93$              (0.27)$             1.661.800.071.87aOne time separation costs incurred at the segment levelbOne time separation costs incurred at the corporate levelcNettaximpactofaboveitems,plustheadditionof2011specialtaxitemsdIncremental stand alone costs to be incurred in 2012 at the segment level ($8M)eIncremental stand alone costs to be incurred in 2012 at the corporate level ($20M)fIncremental interest expense on long-term debt to be incurred in 2012gTaximpactofincrementalinterestexpenseandstandalonecoststobeincurredin2012hExpected one time separation costs of $8M and $10M to be incurred at the segments and headquarters, respectively.iTax impact of one time separation costs expected to be incurred in 2012.jFull year 2012 diluted shares outstanding are based on diluted shares outstanding for quarter ended March 31, 2012($ Millions, except per share amounts)GuidanceXylem Inc. Non-GAAP Reconciliation