{
  "docId": "019dd923-622c-750b-8b99-65deaf51fc65",
  "docSlug": "41aa7e476e91",
  "documentTitle": "Xylem Inc. (XYL)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Spruce Point Capital Management",
  "documentKindSlug": "activist-deck",
  "documentKindLabel": "Activist deck",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2023-08-09 00:00:00",
  "orientation": "landscape",
  "aspectRatio": 1.3333334,
  "pageNumber": 28,
  "pageCount": 82,
  "prevPage": 27,
  "nextPage": 29,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "dense",
  "nDataPoints": 28,
  "notes": "Uses a table to contrast reported balance sheet cash with 'available' liquidity, highlighting a specific Q1 2023 discrepancy.",
  "elementsJson": [
    "headline_text",
    "paragraph",
    "kpi_table",
    "callout_box"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b99-65deaf51fc65/28",
  "deckHref": "/decks/019dd923-622c-750b-8b99-65deaf51fc65",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b99-65deaf51fc65.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-65deaf51fc65#slide-28",
  "components": [
    {
      "bbox": {
        "h": 0.32,
        "w": 0.12,
        "x": 0.87,
        "y": 0.49
      },
      "kind": "callout",
      "text": "Notice for the first time that cash liquidity fell below cash on the balance sheet while foreign cash balance surged",
      "attrs": null,
      "subkind": "primary",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "861d746f-7cce-4b22-a0c7-f62337e1f341",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "metric",
      "text": "Cash & Cash Equivalents: $837m",
      "attrs": null,
      "subkind": "primary",
      "toolName": "Quantification",
      "toolSlug": "quantification",
      "confidence": null,
      "componentId": "019dd952-fb96-7553-b1c7-f4c0aee10ddd",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.15,
        "w": 0.96,
        "x": 0.02,
        "y": 0.17
      },
      "kind": "paragraph",
      "text": "There is more subtle evidence that Xylem was experiencing financial stress leading up to the Evoqua acquisition. Looking carefully at its cash and liquidity, we find that cash stated on the balance sheet was not listed as fully available in its \"Funding and Liquidity Strategy\" section of its SEC filings. In Q1'23, cash on the balance sheet was listed at $837m, but only $800m was available. Moreover, we find that foreign cash materially increased to 86% of total cash on hand at year end. To accommodate this stress and cash needs for closing, we believe Xylem entered into a new 5-year $1.0bn credit facility with a $300m accordion in March 2023.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "050a69f6-f6de-423b-bfd0-a4c711f466fa",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.38,
        "x": 0.02,
        "y": 0.92
      },
      "kind": "source-note",
      "text": "Source: Xylem financial statements, Spruce Point analysis",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "9aa4276c-e5a7-460a-972d-c179c5b94af4",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.54,
        "w": 0.86,
        "x": 0.02,
        "y": 0.36
      },
      "kind": "table",
      "text": "Xylem Cash And Liquidity Analysis table",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c0bce4bb-2676-4154-bd1e-89fb2f151806",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.07,
        "w": 0.65,
        "x": 0.31,
        "y": 0.03
      },
      "kind": "title",
      "text": "Subtle Evidence of Liquidity Challenges Leading Up To The Acquisition",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "b49ad671-6b45-4db0-805f-db4473dd85f9",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [],
  "arcBeats": [
    {
      "to": 79,
      "from": 9,
      "beatId": "b68955ea-1bea-4271-af69-04b4b38ed3c6",
      "arcName": "Problem-Agitate-Solution",
      "arcSlug": "problem-agitate-solution",
      "beatName": "Expose Contradiction",
      "beatSlug": null,
      "evidence": "The deck presents a series of contradictions and concerns about Xylem's financial reporting, operations, and growth prospects",
      "position": 0,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    },
    {
      "to": 56,
      "from": 11,
      "beatId": "8beb67eb-29a7-4acc-8013-1400d57c9a45",
      "arcName": "Problem-Agitate-Solution",
      "arcSlug": "problem-agitate-solution",
      "beatName": "Preempt Rebuttal",
      "beatSlug": null,
      "evidence": "The deck anticipates and addresses potential rebuttals to its thesis",
      "position": 2,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    }
  ],
  "loops": [
    {
      "to": 82,
      "from": 1,
      "name": "Cost Of Inaction",
      "slug": "27-cost-of-inaction",
      "bestFor": "Urgent budget requests, compliance, risk mitigation",
      "matchId": "2fa1c508-68a2-4a6b-9e65-5ff630e9c720",
      "evidence": "The deck presents a detailed analysis of the risks and consequences of not taking action on Xylem's challenges",
      "position": 1,
      "objective": "Highlight the risks of not taking action",
      "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point",
      "confidence": 0.7,
      "description": "Quantify what happens if the audience does nothing"
    },
    {
      "to": 77,
      "from": 6,
      "name": "So What Cascade",
      "slug": "41-so-what-cascade",
      "bestFor": "Data presentations, executive summaries, driving to recommendations",
      "matchId": "7d351594-e5d5-4f56-831e-33e1f8bcec2d",
      "evidence": "The deck presents a series of logical and connected arguments to support its thesis",
      "position": 2,
      "objective": "Build a logical case for the thesis",
      "structure": "The Data -> So What? (Insight 1) -> So What? (Insight 2) -> So What? (The Action)",
      "confidence": 0.7,
      "description": "Chain insights together, each answering 'so what?' until you reach the actionable conclusion"
    }
  ],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}