Evoqua Water Technologies : Q2 2023 Presentation

Second Quarter 2023 Earnings May 2, 2023

Forward-Looking Statement Safe Harbor and non-GAAP Financial Information

This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934, as amended. You can generally identify forward-looking statements by our use of forward-looking terminology such as "aim," "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "goal," "intend," "may," "might," "plan," "progress," "potential," "predict," "projection," "seek," "should," "will," or "would" or the negative thereof or other variations thereon or comparable terminology. All of these forward-looking statements are based on our current expectations, assumptions, estimates, and projections. While we believe these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors may cause our actual results, performance, or achievements to differ materially from any future results, performance, or achievements expressed or implied by these forward-looking statements, or could affect our share price. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include, among other things, the failure to complete the proposed transaction with Xylem Inc. ("Xylem") (the "Merger") on the anticipated terms and timing, or at all; the failure to obtain stockholder approvals or to satisfy any of the other conditions to the Merger on a timely basis or at all, or other delays in completing the Merger; the failure to obtain necessary regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the Merger); the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the Company's merger agreement with Xylem; the possibility that the Merger may be less accretive than expected, or may be dilutive; the possibility that the anticipated benefits of the Merger will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where the Company and Xylem do business; the possibility that the Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management's attention from ongoing business operations and opportunities, as a result of the Merger; the risk that stockholder litigation in connection with the Merger may affect the timing or occurrence of the Merger or result in significant costs of defense, indemnification and liability; the effect of the announcement of the Merger on our ability to maintain relationships with customers, suppliers, and other third parties; uncertainty as to the long-term value of Xylem's common stock; material, freight, and labor inflation, commodity and component availability constraints, and disruptions in global supply chains and transportation services; general global economic and business conditions, including the impacts of rising interest rates, recessionary conditions, geopolitical conflicts, such as the conflict between Russia and Ukraine and tensions between China and the U.S., and the COVID-19 pandemic; our ability to execute projects on budget and on schedule; the potential for us to incur liabilities to customers as a result of warranty claims or failure to meet performance guarantees; our ability to meet our own and our customers' safety standards; failure to effectively treat emerging contaminants; our ability to continue to develop or acquire new products, services and solutions that allow us to compete successfully in our markets; our ability to implement our growth strategy, including acquisitions, and our ability to identify suitable acquisition targets; our ability to operate or integrate any acquired businesses, assets or product lines profitably; our ability to achieve the expected benefits of our restructuring actions; delays in enactment or repeals of environmental laws and regulations; the potential for us to become subject to claims relating to handling, storage, release or disposal of hazardous materials; our ability to retain our senior management, skilled technical, engineering, sales, and other key personnel and to attract and retain key talent in increasingly competitive labor markets; including as a result of the announcement of the Merger; risks associated with international sales and operations; our ability to adequately protect our intellectual property from third-party infringement; risks related to our contracts with federal, state, and local governments, including risk of termination or modification prior to completion; risks associated with product defects and unanticipated or improper use of our products; our ability to accurately predict the timing of contract awards; risks related to our substantial indebtedness; our increasing dependence on the continuous and reliable operation of our information technology systems; risks related to foreign, federal, state and local environmental, health and safety laws and other applicable laws and regulations and the costs associated therewith; our ability to execute on our strategies related to environmental, social, and governance matters, and achieve related goals and targets, including as a result of evolving standards, laws, regulations, processes, and assumptions, delayed scientific and technological developments, increased costs, and changes in carbon markets; and other risks and uncertainties, including those listed under Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended September 30, 2022, as filed with the SEC on November 16, 2022, and in other filings we may make from time to time with the SEC. All statements other than statements of historical fact included in this presentation are forward-looking statements, including, but not limited to, certain plans, expectations, goals, projections, and statements about the benefits of the Merger, the expected timing of completion of the Merger, expectations for fiscal year 2023, expectations related to customer demand, our book to bill ratio, pricing initiatives, supply chain challenges, inflation, material and labor availability, and general macroeconomic conditions, and expectations with respect to the integration and performance of our recent acquisitions, including the realization of expected synergies. Any forward-looking statements made in this presentation speak only as of the date of this presentation. Except as required by law, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements made herein, whether as a result of new information, future events or otherwise after the date of this presentation. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to the date of this presentation.

Immaterial rounding differences may be present in the data included in this presentation. Certain prior period amounts have been reclassified to conform to the current period presentation.

Use of Non-GAAPFinancial Measures - This presentation contains financial measures that are not calculated and presented in accordance with generally accepted accounting principles in the United States ("GAAP"), including EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, net working capital, net working capital to LTM revenue ratio, net leverage ratio, total net debt, adjusted free cash flow, adjusted free cash flow conversion, total Integrated Solutions and Services segment backlog, and service/aftermarket backlog. These non-GAAP financial measures are provided as additional information for investors. We believe these non-GAAP financial measures are helpful to management and investors in highlighting trends in our operating results and provide greater clarity and comparability period over period to management and our investors regarding the operational impact of long-term strategic decisions relating to capital structure, the tax jurisdictions in which we operate and capital investments. The presentation of this additional information is not meant to be considered in isolation or as a substitute for GAAP measures. For definitions of the non-GAAP financial measures used in this presentation and reconciliations to the most directly comparable respective GAAP measures, see the Appendix to this presentation.

© 2023 EVOQUA WATER TECHNOLOGIES | 2

Q3 FY23 End Market Order Outlook

	Q3 2023	PERCENTAGE(2)OF		Q3 2023
PRIMARY END	EXPECTED	PRIMARY END	EXPECTED
DEMAND	SALES (FY21)	DEMAND
MARKETS	OUTLOOK(1)		MARKETS	OUTLOOK(1)
	Life	~20%		Light &
		General
	Sciences(3)
				Industry
	Municipal			Chemical
	Waste
	DIGITS		Processing
	water
	Power		Micro-
	SINGLE		electronics
	Refining &		Aquatics
	Marine	/ MID
			Municipal
	Food &	LOW
		Drinking
	Beverage			Water(4)

1. Q3 2023 expected order demand compared to Q3 2022
2. Management estimates; denoting approximate relative size of each end market
3. Excludes impact of divestiture of Blood Filter and Water Filter to Medica (March 2023)
4. Excludes impact of pending divestiture of Carbon Reactivation and Slurry Services to Desotec (announced February 2023)

KEY DEFINITION

GrowthNeutral

Slight Decline

Decline

© 2023 EVOQUA WATER TECHNOLOGIES | 3

Impacting Customers' Sustainability Efforts

2023 Evoqua Sustainability Award Winner

(International)

CUSTOMER

Zhen Ding Technology Holding

EVOQUA SOLUTION

Application of Magneto Anodes

2023 Evoqua Sustainability Award Winner

(North America)

CUSTOMER

Silfex - A Lam Research Company

EVOQUA SOLUTION

Ultrapure system upgrade and water reuse design - Brine recovery RO + custom controls and flow totalizers Service contract and engineering support

HIGHLIGHTS

• Significant water and power savings due to more efficient Magneto Anode technology
• • ~5000 tons water reduction
  • ~400-650MHw reduction
• Metal wastewater avoided
• • ~15 tons metal waste avoided
  • ~500 tons wastewater reduction

HIGHLIGHTS

• Project reuses >90% total water discharge, 81.6 mg/yr
• Reduced 1 ton CO2 emissions realized
• Reduced hazardous chemical handling
• Project reduces salt use in water softener by ~144,000 lbs/yr
• Evoqua contracted to design custom water recovery process

Note - Use of the SDG logos or icons does not imply the endorsement of the United Nations. Learn more:https://www.un.org/sustainabledevelopment.

© 2023 EVOQUA WATER TECHNOLOGIES | 4

Second Quarter 2023 Results

	Q2'22	Q2'23	Variance
($ in millions)
Revenue	$426.7	$477.8	12.0%
Adjusted EBITDA	$73.2	$88.5	20.9%
Adjusted EBITDA margin	17.2%	18.5%	130 bps

Second quarter 2023 revenue

($ in millions)

	$49.6	$5.3	$477.8
$426.7	11.6%	1.2%	$(3.8)
		(0.8)%
			12.0%

Q2'22	Organic	Inorganic	FX	Q2'23
	growth	growth

Q2'23 HIGHLIGHTS

Revenue growth of 12.0%

• Organic growth contributed 11.6%
• • Capital and Service
  • Across most regions and all product lines
• Favorable price realization and higher volume
• Unfavorable FX impact, primarily APT

Adjusted EBITDA growth of 20.9%

• Growth driven by favorable price realization, higher sales volume, mix
• Partially offset by inflation, unfavorable foreign currency translation, and productivity
• Adjusted EBITDA margin increased 130 bps

© 2023 EVOQUA WATER TECHNOLOGIES | 5