Fourth Quarter Fiscal 2024 Highlights (All comparisons
against the fourth quarter fiscal 2023 unless otherwise noted)
- Sales of $935 million, up 6.4%
- GAAP EPS of $0.90, up 20.0%; adjusted EPS of $0.94
- Returned approximately $82 million to shareholders through
share repurchases and dividends
- Announced plans to optimize footprint aimed at increased
efficiency
Full Year Fiscal 2024 Highlights (All comparisons against
fiscal year 2023 unless otherwise noted)
- Sales of $3.6 billion, up 4.5%
- GAAP EPS of $3.38, up 16.6%; adjusted EPS of $3.42
- Returned approximately $286 million to shareholders through
share repurchases and dividends
Fiscal 2025 Guidance
- Expect full year fiscal 2025 sales growth of 2% to 6% and
adjusted EPS of $3.56 to $3.72
Donaldson Company, Inc. (NYSE: DCI) (Donaldson or the Company),
a global leader in technology-led filtration products and
solutions, today reported fiscal 2024 generally accepted accounting
principles (GAAP) net earnings of $109.7 million in the fourth
quarter and $414.0 million for the full year, compared with $91.9
million and $358.8 million, respectively, in fiscal 2023. Fiscal
2024 GAAP earnings per share (EPS)12 were $0.90 in the fourth
quarter and $3.38 for the full year, compared with $0.75 and $2.90,
respectively, in fiscal 2023. Fourth quarter and full-year 2024
adjusted EPS3 were $0.94 and $3.42, respectively, compared to $0.78
and $3.04, respectively, in fiscal 2023. The tables attached to
this press release include a reconciliation of GAAP to non-GAAP
measures.
“In fourth quarter, we delivered an all-time high level of
profitability through solid sales and robust margin expansion while
continuing to invest for the future, capping off a record year for
Donaldson,” said Tod Carpenter, chairman, president and chief
executive officer. “Also in the quarter, we launched a series of
footprint and cost optimization programs to strengthen our
foundation for long-term profitable growth.
“For fiscal 2025, we expect to achieve another year of record
sales and earnings as we execute on our longer-term strategic
initiatives. We are updating our fiscal 2026 financial targets to
reflect our continued confidence in delivering strong consolidated
profitability while adjusting for market-driven and
segment-specific sales and margin trends.”
____________________________
1
Fourth quarter 2024, 2023, and full-year
2023 earnings include Restructuring and Other Charges. See
Restructuring and Other Charges section for more information.
2
All EPS figures refer to diluted EPS.
3
Adjusted EPS is a non-GAAP financial
measure that excludes the impact of certain items not related to
ongoing operations.
Fourth Quarter Operating
Results
Sales increased 6.4% to $935.4 million from $879.5 million in
2023, due to increased volume and pricing benefits.
Three Months Ended
Twelve Months Ended
July 31, 2024
July 31, 2024
Reported % Change
Constant Currency %
Change
Reported % Change
Constant Currency %
Change
Mobile Solutions segment
Off-Road
(13.0)%
(11.7)%
(11.2)%
(11.3)%
On-Road
(11.8)
(9.7)
(4.1)
(3.0)
Aftermarket
12.6
13.9
8.1
8.2
Total Mobile Solutions segment
6.1
7.4
3.5
3.6
Industrial Solutions segment
Industrial Filtration Solutions
(1.5)
(0.8)
3.3
3.2
Aerospace and Defense
39.7
40.1
16.0
15.5
Total Industrial Solutions segment
3.9
4.6
5.1
4.9
Life Sciences segment
Total Life Sciences segment
20.7
23.2
11.5
11.7
Total Company
6.4%
7.6%
4.5%
4.5%
Mobile Solutions segment (Mobile) sales increased 6.1%,
resulting from strength in Aftermarket partially offset by Off-Road
and On-Road declines. Aftermarket sales grew 12.6%, driven by the
lapping of OEM customer destocking in the prior year period as well
as improved delivery rates and market share gains in the
independent channel. Off-Road sales fell 13.0% as weak agriculture
markets persisted in most regions. On-Road sales declined 11.8% due
to lower equipment production in China and the United States.
Industrial Solutions segment (Industrial) sales increased 3.9%,
driven by robust Aerospace and Defense sales, which rose 39.7% due
to strong end-market conditions. Industrial Filtration Solutions
(IFS) sales declined 1.5% as weaker dust collection demand in
Europe and Power Generation project timing negatively impacted
sales.
Life Sciences segment sales increased 20.7% year over year as a
result of volume growth in Disk Drive and Food and Beverage.
Gross margin was 35.8%, up 170 basis points from 34.1% in 2023
driven by select input cost deflation and leverage on higher sales.
Adjusted gross margin, which excludes the impact from restructuring
and other charges, was 36.2%, an increase from 34.3% in 2023.
Operating expenses as a percentage of sales were 20.2%, a 20
basis point improvement from 20.4% in the prior year, resulting
from leverage on higher sales. Adjusted operating expenses as a
percentage of sales were 19.9% compared with 20.0% in 2023.
Operating income as a percentage of sales (operating margin) of
15.6%, increased 190 basis points year over year from 13.7% in 2023
driven by gross margin expansion and operating expense leverage.
Adjusted operating margin was 16.3% compared with 14.3% in the
prior year.
Interest expense was $5.3 million versus $4.9 million in 2023 as
a result of higher interest rates. The Company's effective tax rate
was 21.3% versus 21.7% a year ago.
For the full year, Donaldson paid $122.8 million in dividends
and repurchased 2.0% of its outstanding shares for $163.3
million.
Full-Year Restructuring and Other
Charges
During fourth quarter fiscal 2024, Donaldson incurred $6.4
million of restructuring and other charges, including $6.0 million
of severance costs largely related to footprint optimization and
cost reduction initiatives. Through these efforts, the Company
expects to improve capacity utilization and efficiency across its
global footprint while continuing to meet customer needs.
During fourth quarter and full year fiscal 2023, Donaldson
incurred $4.9 million and $21.8 million, respectively, of
restructuring and other charges, largely related to the Company’s
organizational redesign as well as costs associated with exiting a
lower-margin customer program.
Fiscal 2025 Outlook
Adjusted full-year EPS is expected to be between $3.56 and
$3.72, compared with fiscal 2024 GAAP and adjusted EPS of $3.38 and
$3.42, respectively. Sales are projected to increase between 2% and
6% over prior year, with a pricing benefit of approximately 1%.
Mobile sales are forecast to be flat to up 4% year over year.
Off-Road sales are projected to increase low-single digits driven
by market share gains. On-Road sales are estimated to decrease
low-double digits due to an exit from non-strategic products
combined with weak end-market conditions. Aftermarket sales are
forecast to increase low-single digits as a result of continued
strength in vehicle utilization rates and market share gains.
Industrial sales are expected to grow between 4% and 8% versus
2024. IFS sales are forecast to increase high-single digits with
strength across most businesses, including dust collection,
Industrial Hydraulics and Industrial Gases. Aerospace and Defense
sales are projected to be approximately flat after cycling
difficult comparisons in 2024.
Life Sciences sales are forecast to grow low-double digits
compared with prior year driven by sales increases in all
businesses.
Operating margin is forecast to be between 15.3% and 15.9%
versus 15.2%, or 15.4% on an adjusted basis, in 2024 largely driven
by sustained gross margin performance.
Interest expense is projected to be approximately $21 million
and other income is expected to be between $16 million and $20
million. Donaldson expects a fiscal 2025 effective income tax rate
of between 23% and 25%.
Capital expenditures are forecast to be between $85 million and
$105 million and free cash flow conversion is projected to be
between 85% and 95%. For the full year, Donaldson expects to
repurchase 2% to 3% of its shares outstanding.
Updated Fiscal 2026
Targets
In view of fiscal 2024 results, combined with an updated
performance outlook for fiscal 2025 and 2026, Donaldson is revising
its fiscal 2026 financial targets as follows:
Current Targets
Prior Targets
(announced at 2023 Investor
Day)
FY23 -
FY26 Sales CAGR
FY26
Operating Margin
FY23 -
FY26 Sales CAGR
FY26
Operating Margin
Mobile Solutions
2% to 6%
18.1% to 18.9%
2% to 6%
15.6% to 16.4%
Industrial Solutions
4% to 8%
17.8% to 18.6%
4% to 8%
16.6% to 17.4%
Life Sciences
12% to 16%
5% to 11%
18% to 22%
22.1% to 22.9%
Total
3% to 7%
15.8% to 16.6%
4% to 8%
15.6% to 16.4%
Total Company sales through fiscal 2026 are forecast to increase
between 3% and 7%, slightly below the previously provided range,
due to softer Life Sciences end-market conditions. Total operating
margin in fiscal 2026 is expected to be 15.8% to 16.6%, slightly
ahead of the prior range.
Carpenter continued, “In fiscal 2025 and 2026, Mobile and
Industrial operating margin strength is forecast to more than
offset weaker-than-expected Life Sciences performance. The
elongated ramp up in Life Sciences profitability is driven by
challenging market conditions and constrained customer capital
spending. Overall, we are focused on executing our balanced growth
strategy and remain highly confident in our ability to
commercialize our innovative technologies and create sustainable
long-term value in our Life Sciences business.”
Miscellaneous
The Company will webcast its fourth quarter and full-year 2024
earnings conference call today at 9:00 a.m. CT. To listen to the
webcast, visit the “Events & Presentations” section of
Donaldson’s Investor Relations website (IR.Donaldson.com), and
click on the “listen to webcast” option. The webcast replay will be
available at approximately 12:00 p.m. CT today. Also available on
the website is the Company’s supplemental quarterly earnings
presentation.
Statements in this release regarding future events and
expectations, such as forecasts, plans, trends and projections
relating to the Company’s business and financial performance, are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and are identified by
words or phrases such as “will likely result,” “are expected to,”
“will continue,” “will allow,” “estimate,” “project,” “believe,”
“expect,” “anticipate,” “forecast,” “plan” and similar expressions.
These forward-looking statements speak only as of the date such
statements are made and are subject to risks and uncertainties that
could affect the Company’s performance and could cause the
Company’s actual results for future periods to differ materially
from any opinions or statements expressed. These factors include,
but are not limited to, challenges in global operations; impacts of
global economic, industrial and political conditions on product
demand; impacts from unexpected events; effects of unavailable raw
materials, significant demand fluctuations or material cost
changes; inability to attract and retain qualified personnel;
inability to meet customer demand; inability to maintain
competitive advantages; threats from disruptive technologies;
effects of highly competitive markets with pricing pressure;
exposure to customer concentration in certain cyclical industries;
inability to manage productivity improvements; inability to achieve
commitments related to ESG; results of execution of any
acquisition, divestiture and other strategic transactions;
vulnerabilities associated with information technology systems and
security; inability to protect and enforce intellectual property
rights; costs associated with governmental laws and regulations;
impacts of foreign currency fluctuations; and effects of changes in
capital and credit markets. These and other factors are described
in Part I, Item 1A, “Risk Factors” of the Company’s Annual Report
on Form 10-K for the fiscal year ended July 31, 2023. 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, unless required by law. The results
presented herein are preliminary, unaudited and subject to revision
until the Company files its results with the United States
Securities and Exchange Commission on Form 10-K.
About Donaldson Company,
Inc.
Founded in 1915, Donaldson (NYSE: DCI) is a global leader in
technology-led filtration products and solutions, serving a broad
range of industries and advanced markets. Diverse, skilled
employees at over 140 locations on six continents partner with
customers - from small business owners to R&D organizations and
the world’s biggest OEM brands. Donaldson solves complex filtration
challenges through three primary segments: Mobile Solutions,
Industrial Solutions and Life Sciences. Additional information is
available at www.Donaldson.com.
DONALDSON COMPANY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS
(In millions, except per share
amounts)
(Unaudited)
Three Months Ended
Twelve Months Ended
July 31,
July 31,
2024
2023
Change
2024
2023
Change
Net sales
$
935.4
$
879.5
6.4
%
$
3,586.3
$
3,430.8
4.5
%
Cost of sales
600.6
579.4
3.7
2,311.9
2,270.2
1.8
Gross profit
334.8
300.1
11.6
1,274.4
1,160.6
9.8
Selling, general and administrative
163.2
157.6
3.6
636.7
602.3
5.7
Research and development
25.4
22.0
15.6
93.6
78.1
19.8
Operating expenses
188.6
179.6
5.0
730.3
680.4
7.3
Operating income
146.2
120.5
21.4
544.1
480.2
13.3
Interest expense
5.3
4.9
8.1
21.4
19.2
11.3
Other expense (income), net
1.5
(1.7
)
NM
(12.6
)
(7.7
)
62.6
Earnings before income taxes
139.4
117.3
18.9
535.3
468.7
14.2
Income taxes
29.7
25.4
17.0
121.3
109.9
10.4
Net earnings
$
109.7
$
91.9
19.4
%
$
414.0
$
358.8
15.4
%
Weighted average shares – basic
120.4
121.4
(0.8
)%
120.7
121.8
(0.9
)%
Weighted average shares – diluted
122.5
123.2
(0.6
)%
122.6
123.6
(0.8
)%
Net EPS – basic
$
0.91
$
0.76
19.7
%
$
3.43
$
2.95
16.3
%
Net EPS – diluted
$
0.90
$
0.75
20.0
%
$
3.38
$
2.90
16.6
%
Dividends paid per share
$
0.27
$
0.25
8.0
%
$
1.02
$
0.94
8.5
%
Note: Amounts may not foot due to
rounding.
NM = Not meaningful
DONALDSON COMPANY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In millions)
(Unaudited)
July 31,
July 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
232.7
$
187.1
Accounts receivable, net
629.7
599.7
Inventories, net
476.7
418.1
Prepaid expenses and other current
assets
99.0
81.1
Total current assets
1,438.1
1,286.0
Property, plant and equipment, net
645.5
652.9
Goodwill
478.4
481.1
Intangible assets, net
171.9
188.1
Other long-term assets
180.4
162.4
Total assets
$
2,914.3
$
2,770.5
Liabilities and Stockholders’
Equity
Current liabilities:
Short-term borrowings
$
28.3
$
34.1
Current maturities of long-term debt
25.0
125.0
Accounts payable
379.4
304.9
Accrued employee compensation and related
taxes
140.9
119.4
Deferred revenue
19.7
25.3
Income taxes payable
42.6
32.3
Dividends payable
32.5
30.4
Other current liabilities
114.1
85.0
Total current liabilities
782.5
756.4
Long-term debt
483.4
496.6
Non-current income taxes payable
39.8
56.5
Deferred income taxes
16.1
32.3
Other long-term liabilities
103.4
108.0
Total liabilities
1,425.2
1,449.8
Total stockholders’ equity
1,489.1
1,320.7
Total liabilities and stockholders’
equity
$
2,914.3
$
2,770.5
DONALDSON COMPANY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
Twelve Months Ended
July 31,
2024
2023
Operating Activities
Net earnings
$
414.0
$
358.8
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization
98.4
92.3
Deferred income taxes
(24.3
)
(15.3
)
Stock-based compensation expense
22.0
20.4
Other, net
(1.0
)
6.3
Changes in operating assets and
liabilities
(16.6
)
82.0
Net cash provided by operating
activities
492.5
544.5
Investing Activities
Purchases of property, plant and
equipment
(85.6
)
(118.5
)
Proceeds from sale of property, plant and
equipment
0.7
0.4
Acquisitions, net of cash acquired
(2.0
)
(209.2
)
Net cash used in investing activities
(86.9
)
(327.3
)
Financing Activities
Proceeds from long-term debt
119.7
189.2
Repayments of long-term debt
(228.8
)
(219.6
)
Change in short-term borrowings
(5.7
)
30.4
Purchase of treasury stock
(162.7
)
(141.8
)
Payment of contingent consideration
(1.7
)
—
Dividends paid
(122.8
)
(114.4
)
Tax withholding for stock compensation
transactions
(8.0
)
(4.3
)
Exercise of stock options and other
54.1
38.3
Net cash used in financing activities
(355.9
)
(222.2
)
Effect of exchange rate changes on
cash
(4.1
)
(1.2
)
Income (decrease) in cash and cash
equivalents
45.6
(6.2
)
Cash and cash equivalents, beginning of
year
187.1
193.3
Cash and cash equivalents, end of year
$
232.7
$
187.1
CONSOLIDATED RATE
ANALYSIS
(Unaudited)
Three Months Ended
Twelve Months Ended
July 31,
July 31,
2024
2023
2024
2023
Gross margin
35.8 %
34.1 %
35.5 %
33.8 %
Operating expenses
20.2 %
20.4 %
20.4 %
19.8 %
Operating margin
15.6 %
13.7 %
15.2 %
14.0 %
Other expense (income), net
0.2 %
(0.2) %
(0.3) %
(0.2) %
Depreciation and amortization
2.7 %
2.9 %
2.7 %
2.7 %
EBITDA
18.1 %
16.8 %
18.3 %
16.9 %
Effective tax rate
21.3 %
21.7 %
22.7 %
23.4 %
Earnings before income taxes - Mobile
Solutions
18.3 %
16.2 %
18.0 %
15.2 %
Earnings before income taxes - Industrial
Solutions
20.1 %
19.2 %
18.6 %
18.4 %
Earnings (loss) before income taxes - Life
Sciences
(1.2) %
(12.4) %
(3.9) %
4.1 %
Cash conversion ratio
97.4 %
179.9 %
98.4 %
118.8 %
Three Months Ended
Twelve Months Ended
July 31,
July 31,
2024
2023
2024
2023
Adjusted Rates
Gross margin
36.2 %
34.3 %
35.6 %
33.9 %
Operating expenses
19.9 %
20.0 %
20.3 %
19.3 %
Operating margin
16.3 %
14.3 %
15.4 %
14.6 %
Other expense (income), net
0.2 %
(0.2) %
(0.3) %
(0.2) %
Depreciation and amortization
2.7 %
2.9 %
2.7 %
2.7 %
EBITDA
18.8 %
17.3 %
18.4 %
17.5 %
Effective tax rate
21.5 %
21.8 %
22.7 %
23.5 %
Earnings before income taxes - Mobile
Solutions
18.3 %
16.2 %
18.0 %
15.2 %
Earnings before income taxes - Industrial
Solutions
20.1 %
19.2 %
18.6 %
18.4 %
Earnings (loss) before income taxes - Life
Sciences
(1.2) %
(12.4) %
(3.9) %
4.1 %
Cash conversion ratio
93.3 %
173.0 %
97.3 %
113.6 %
Note: Rate analysis metrics are computed
by dividing the applicable amount by net sales, and cash conversion
ratio reflects free cash flow divided by net earnings. Adjusted
rates exclude charges related to restructuring in fiscal 2024, and
the organizational redesign and costs associated with exiting a
lower-margin customer program in fiscal 2023. Adjusted rates are
non-GAAP measures; see the Reconciliation of Non-GAAP Financial
Measures schedule for additional information.
SEGMENT DETAIL
(In millions)
(Unaudited)
Three Months Ended July
31,
Twelve Months Ended July
31,
2024
2023
Change
2024
2023
Change
Net sales
Mobile Solutions segment
Off-Road
$
89.9
$
103.4
(13.0
)%
$
380.8
$
428.7
(11.2
)%
On-Road
32.9
37.3
(11.8
)
139.8
145.8
(4.1
)
Aftermarket
452.5
401.8
12.6
1,730.2
1,600.3
8.1
Total Mobile Solutions segment
575.3
542.5
6.1
2,250.8
2,174.8
3.5
Industrial Solutions segment
Industrial Filtration Solutions
237.4
241.0
(1.5
)
901.1
872.2
3.3
Aerospace and Defense
50.4
36.1
39.7
165.4
142.5
16.0
Total Industrial Solutions segment
287.8
277.1
3.9
1,066.5
1,014.7
5.1
Life Sciences segment
Total Life Sciences segment
72.3
59.9
20.7
269.0
241.3
11.5
Total Company
$
935.4
$
879.5
6.4
%
$
3,586.3
$
3,430.8
4.5
%
Earnings (loss) before income taxes
Mobile Solutions segment
$
105.2
$
88.1
19.4
%
$
404.5
$
330.4
22.4
%
Industrial Solutions segment
57.8
53.2
8.6
198.8
186.2
6.8
Life Sciences segment
(0.9
)
(7.4
)
87.8
(10.4
)
9.9
NM
Corporate and unallocated
(22.7
)
(16.6
)
(36.7
)
(57.6
)
(57.8
)
0.3
Total Company
$
139.4
$
117.3
18.9
%
$
535.3
$
468.7
14.2
%
Earnings (loss) before income taxes
percentage
Mobile Solutions segment
18.3
%
16.2
%
2.1
%
18.0
%
15.2
%
2.8
%
Industrial Solutions segment
20.1
%
19.2
%
0.9
%
18.6
%
18.4
%
0.2
%
Life Sciences segment
(1.2
)%
(12.4
)%
11.2
%
(3.9
)%
4.1
%
(8.0
)%
Note: Earnings (loss) before income taxes
percentage is calculated by dividing earnings before income taxes
by net sales. Amounts may not foot due to rounding.
NM = Not meaningful
SEGMENT SALES PERCENT CHANGE
FROM PRIOR PERIODS BY GEOGRAPHY, AS REPORTED
(Unaudited)
Three Months Ended July 31,
2024
TOTAL
U.S.(1)/CA(2)
EMEA(3)
APAC(4)
LATAM (5)
Mobile Solutions segment
Off-Road
(13.0
)%
13.9
%
(30.7
)%
(18.2
)%
(32.6
)%
On-Road
(11.8
)
(6.4
)
1.1
(34.1
)
47.0
Aftermarket
12.6
15.9
7.4
3.5
21.6
Total Mobile Solutions segment
6.1
13.5
(4.0
)
(4.9
)
18.8
Industrial Solutions segment
Industrial Filtration Solutions
(1.5
)
1.4
(8.2
)
0.5
22.7
Aerospace and Defense
39.7
51.8
13.0
18.3
Total Industrial Solutions segment
3.9
10.8
(5.9
)
0.8
22.7
Life Sciences segment
Total Life Sciences segment
20.7
(14.7
)
17.4
47.0
36.8
Total Company
6.4
%
11.5
%
(2.8
)%
3.1
%
19.5
%
Twelve Months Ended July 31,
2024
TOTAL
U.S./CA
EMEA
APAC
LATAM
Mobile Solutions segment
Off-Road
(11.2
)%
4.4
%
(16.9
)%
(24.3
)%
(25.9
)%
On-Road
(4.1
)
(1.6
)
13.4
(18.8
)
15.3
Aftermarket
8.1
10.5
2.8
5.1
12.5
Total Mobile Solutions segment
3.5
8.4
(2.7
)
(3.8
)
10.2
Industrial Solutions segment
Industrial Filtration Solutions
3.3
6.6
0.2
(4.2
)
16.2
Aerospace and Defense
16.0
19.9
4.7
49.0
Total Industrial Solutions segment
5.1
9.2
0.7
(3.4
)
16.2
Life Sciences segment
Total Life Sciences segment
11.5
(9.4
)
19.6
13.0
35.4
Total Company
4.5
%
8.1
%
0.5
%
(1.2
)%
11.2
%
Note: Amounts may not foot due to
rounding.
(1) United States (U.S.); (2) Canada (CA);
(3) Europe, Middle East and Africa (EMEA); (4) Asia Pacific (APAC);
(5) Latin America (LATAM)
SEGMENT SALES PERCENT CHANGE
FROM PRIOR PERIODS BY GEOGRAPHY, CONSTANT CURRENCY
(Unaudited)
Three Months Ended July 31,
2024
TOTAL
U.S./CA
EMEA
APAC
LATAM
Mobile Solutions segment
Off-Road
(11.7
)%
13.9
%
(30.0
)%
(13.8
)%
(30.5
)%
On-Road
(9.7
)
(6.4
)
3.4
(29.1
)
57.3
Aftermarket
13.9
15.9
8.5
6.9
24.0
Total Mobile Solutions segment
7.4
13.5
(3.0
)
(1.1
)
21.2
Industrial Solutions segment
Industrial Filtration Solutions
(0.8
)
1.4
(7.7
)
3.8
25.2
Aerospace and Defense
40.1
51.8
14.1
22.6
Total Industrial Solutions segment
4.6
10.8
(5.3
)
4.2
25.2
Life Sciences segment
Total Life Sciences segment
23.2
(14.7
)
18.2
53.0
41.2
Total Company
7.6
%
11.5
%
(1.9
)%
7.1
%
21.9
%
Twelve Months Ended July 31,
2024
TOTAL
U.S./CA
EMEA
APAC
LATAM
Mobile Solutions segment
Off-Road
(11.3
)%
4.4
%
(19.1
)%
(20.6
)%
(26.4
)%
On-Road
(3.0
)
(1.6
)
12.3
(14.4
)
15.9
Aftermarket
8.2
10.5
1.3
8.6
11.8
Total Mobile Solutions segment
3.6
8.4
(4.4
)
(0.2
)
9.6
Industrial Solutions segment
Industrial Filtration Solutions
3.2
6.6
(1.6
)
(1.0
)
16.1
Aerospace and Defense
15.5
19.9
2.4
53.5
(56.8
)
Total Industrial Solutions segment
4.9
9.2
(1.2
)
(0.2
)
16.1
Life Sciences segment
Total Life Sciences segment
11.7
(9.4
)
16.7
16.6
35.3
Total Company
4.5
%
8.1
%
(1.4
)%
2.3
%
10.6
%
Note: The constant currency presentation,
which is a non-GAAP measure, excludes the impact of fluctuations in
foreign currency exchange rates. The Company believes providing
constant currency information provides valuable supplemental
information regarding its results of operations. The Company
calculates constant currency percentages by converting its current
period local currency financial results using the prior period
exchange rates and compares these adjusted amounts to its prior
period reported results. Amounts may not foot due to rounding.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
(In millions, except per share
amounts)
(Unaudited)
Three Months Ended
Twelve Months Ended
July 31,
July 31,
2024
2023
2024
2023
Net cash provided by operating
activities
$
126.0
$
190.8
$
492.5
$
544.5
Net capital expenditures
(19.1
)
(25.5
)
(84.9
)
(118.1
)
Free cash flow
$
106.9
$
165.4
$
407.6
$
426.3
Net earnings
$
109.7
$
91.9
$
414.0
$
358.8
Income taxes
29.7
25.4
121.3
109.9
Interest expense
5.3
4.9
21.4
19.2
Depreciation and amortization
24.9
25.1
98.4
92.3
EBITDA
$
169.6
$
147.3
$
655.1
$
580.2
Adjusted net earnings
$
114.5
$
95.6
$
418.8
$
375.2
Adjusted income taxes
31.3
26.6
122.9
115.3
Interest expense
5.3
4.9
21.4
19.2
Depreciation and amortization
24.9
25.1
98.4
92.3
Adjusted EBITDA
$
176.0
$
152.2
$
661.5
$
602.0
Gross profit
$
334.8
$
300.1
$
1,274.4
$
1,160.6
Restructuring and other charges
3.8
1.4
3.8
2.9
Adjusted gross profit
$
338.6
$
301.5
$
1,278.2
$
1,163.5
Operating expense
$
188.6
$
179.6
$
730.3
$
680.4
Restructuring and other charges
(2.6
)
(3.5
)
(2.6
)
(18.9
)
Adjusted operating expense
$
186.0
$
176.1
$
727.7
$
661.5
Operating income
$
146.2
$
120.5
$
544.1
$
480.2
Restructuring and other charges
6.4
4.9
6.4
21.8
Adjusted operating income
$
152.6
$
125.4
$
550.5
$
502.0
Net earnings
$
109.7
$
91.9
$
414.0
$
358.8
Restructuring and other charges, net of
tax
4.8
3.7
4.8
16.4
Adjusted net earnings
$
114.5
$
95.6
$
418.8
$
375.2
Diluted EPS
$
0.90
$
0.75
$
3.38
$
2.90
Restructuring and other charges per
share
0.04
0.03
0.04
0.14
Adjusted diluted EPS
$
0.94
$
0.78
$
3.42
$
3.04
2025 Adjusted EPS Guidance
A reconciliation of the Company’s fiscal 2025 adjusted EPS
guidance to fiscal 2025 GAAP EPS guidance is not included in this
release due to the number of variables in the projected GAAP EPS
range and the Company’s current inability to reasonably quantify
certain amounts, such as restructuring or other charges, that would
be included in the GAAP measure or the individual adjustments for
such reconciliation.
Note: Although free cash flow, EBITDA, adjusted EBITDA, adjusted
gross profit, adjusted operating expense, adjusted operating
income, adjusted income taxes, adjusted net earnings and adjusted
diluted EPS are not measures of financial performance under GAAP,
the Company believes they are useful in understanding its financial
results. Free cash flow is a commonly used measure of a company’s
ability to generate cash in excess of its operating needs. EBITDA
is a commonly used measure of operating earnings less non-cash
expenses. The adjusted basis presentation excludes the impact of
certain matters not related to the Company’s ongoing operations.
Management believes that the adjusted basis presentation reflects
management’s performance in operating the Company and provides a
meaningful representation of the performance of the Company’s core
business and is useful to understanding its financial results. A
shortcoming of these financial measures is that they do not reflect
the Company’s actual results under GAAP. Management does not intend
these items to be considered in isolation or as a substitute for
the related GAAP measures. Amounts may not foot due to
rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240828284425/en/
Sarika Dhadwal (952) 887-3753 Sarika.Dhadwal@Donaldson.com
Grafico Azioni Donaldson (NYSE:DCI)
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