With more than half of the country experiencing drought conditions this year, a survey released by global water technology company Xylem Inc. shows that consumers are more concerned about water than ever before.
Xylem, a company focused on developing improved water technology worldwide, marked its one-year anniversary last month, releasing a survey showing that people are more aware of water issues than ever before.
The company is headquartered in White Plains and was spun off from ITT Corp. last year.
The company released its 2012 Xylem Value of Water Index two weeks ago that showed 77 percent of Americans are concerned about the state of water infrastructure and 61 percent are willing to pay more to fix it – substantial increases over a similar survey Xylem conducted in 2010.
“We launched the 2012 Xylem Value of Water Index because we want to determine exactly what people think about water and what they are willing to do to ensure they have access to this vital resource,” Gretchen McClain, Xylem’s president and CEO, said in a statement. “Keeping our water systems running efficiently to provide safe water to our citizens must become a national priority. This unseen crisis must become a shared responsibility.”
According to the U.S. Drought Monitor (droughtmonitor.unl.edu), the High Plains have an exceptionally high drought level, while the West has severe to extreme droughts.
Xylem said the water industry must play a leadership role in raising public awareness of the decaying water infrastructure and the company supports full water pricing and the development of conservation and reuse efforts.
The survey is based on a telephone study of 1,008 American voters age 18 years and older. The margin of error is plus or minus 3.1 percent. The study was conducted between August 16 and 23.
“The findings were consistent,” said Tom Glover, Xylem’s vice president of global public affairs. “Even in a difficult economy with people acknowledging that their water bills have gone up, people have said they are willing to pay a bit more to ensure ready access to clean water.”
Glover thinks incidents like this year’s drought that plagued much of the country have made people aware of water issues. The Northeast was not impacted by this year’s droughts.
According to the American Water Works Association (AWWA), for every $10 billion spent on water-related projects, an additional 400,000 jobs could be created.
For Xylem, advocating for improved infrastructure is another step for a company gaining its foothold in the industry. Xylem has more than 12,500 employees and in 2011 had revenues of $3.8 billion, doing business in more than 150 countries.
In its most recent earnings report, Xylem’s third quarter produced $931 million in revenue, $557 million in expenses and $374 million in gross profit, with a net income of $72 million. The third quarter of 2011 saw revenues of $939 million, expenses at $574 million, gross profit of $365 million and a net income of $77 million.
The third quarter of 2012 saw basic earnings per share at 39 cents, down from 42 cents in the third quarter of 2011.
Year-to-date, Xylem has $2.8 billion in revenues, $1.7 billion in expenses, $1.1 billion in gross profit and a net income of $224 billion, with total assets of $1.8 billion. Xylem has also earned shareholders $1.20 this year, down from $1.23 at this point in 2011.
“We’ve had a good first year with good operating results,” Glover said. “We’ve captured the enthusiasm of 12,000 employees who are united around water. It’s an interesting and exciting proposition.”
Xylem has been building its brand through acquisitions. The company acquired YSI Inc., a developer of pH sensors for $350 million in September 2011, and in July 2012 acquired Denmark-based MJK Automation, which manufactures equipment for measurement and control of drinking water treatment for $12.5 million. Heartland Pump Rental and Service, an Illinois-based company, was acquired for $29 million.
The company is projecting to spend $300 million to $500 million on acquisitions in 2013.
ITT said spinning off Xylem and other brands put the company in better position to focus on key drivers to accelerate growth.