Donaldson Company, Inc. · NYSE:DCI
Donaldson — Q2 2023 Earnings Presentation
14 slides from Donaldson's earnings presentation, Mar 1, 2023
Slide 1: Second Quarter Fiscal Year 2023 Earnings Call
Second Quarter Fiscal Year 2023 Earnings Call March 2023
Slide 2: Forward-Looking Statement Safe Harbor
Forward-Looking Statement Safe Harbor Statements in this presentation 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
Slide 3: Second Quarter Fiscal Year 2023 Update and Overview
Second Quarter Fiscal Year 2023 Update and Overview Continued Operational Improvements, Strategic Investments, and Shareholder Value Creation • Achieved 6-year quarterly high operating margin on low-single digit sales growth • Returned $98M in second quarter and $171M year to date to shareholders in
Slide 4: Strong Value Proposition
Strong Value Proposition 1. 2. 3. 4. 5. Technology-led Diversified Experienced Global sales, Culture of filtration company portfolio of global management team production and ownership aligns with deep businesses with and engaged distribution with shareholder customer recurring revenue board of direc
Slide 5: Second Quarter FY23 Overview & Highlights
Second Quarter FY23 Overview & Highlights Sales ($M) Adj. Operating Margin(1) Adj. Diluted EPS Up 8% YoY Constant Currency Basis Up 330 bps YoY Up 32% YoY $0.75 $828 15.2% $0.57 +3% $803 11.9% Q2’22 Q2’23 Q2’22 Q2’23 Q2’22 Q2’23 • Positive YoY contribution from price (+10%), partially • Adjusted gro
Slide 6: Redesigned to Further Leverage Strengths
Redesigned to Further Leverage Strengths Old Donaldson New Donaldson FY22 Sales by Segment FY22 Sales by Segment 8% 30% 27% 70% 65% Engine Industrial Mobile Solutions Industrial Solutions Life Sciences Reportable Industries Mobile Off-Road Off-Road Solutions On-Road On-Road Aftermarket Aftermarket A
Slide 7: Mobile Solutions Segment Second Quarter FY23 Results
Mobile Solutions Segment Second Quarter FY23 Results Second Quarter Overview ▪ Total sales increased 2% compared to prior year and grew 6% on a constant currency basis ▪ Sales performance by region: US/CA +5%, EMEA -1%, APAC -8%, Q2’23 Q2’22 YoY LATAM +11% ($ in millions) Sales $523 $514 +2% ▪ Sales
Slide 8: Industrial Solutions Segment Second Quarter FY23 Results
Industrial Solutions Segment Second Quarter FY23 Results Second Quarter Overview ▪ Total sales grew 13% compared to prior year and increased 17% on a constant currency basis ▪ Sales performance by region: US/CA +17%, EMEA +15%, APAC -14%, LATAM +37% Q2’23 Q2’22 YoY ($ in millions) Sales $247 $219 +1
Slide 9: Life Sciences Segment Second Quarter FY23 Results
Life Sciences Segment Second Quarter FY23 Results Second Quarter Overview ▪ Total sales decreased 16% compared to prior year and declined 10% on a constant currency basis ▪ Sales performance by region: US/CA +46%, EMEA 0%, APAC -42%, LATAM +45% Q2’23 Q2’22 YoY ($ in millions) Sales $59 $71 -16% ▪ Lo
Slide 10: Balance Sheet and Cash Flow Overview
Balance Sheet and Cash Flow Overview Net Debt and Financial Leverage Consolidated Results ($M) $600 1.2x Q2’23 Q2’22 YTD’23 YTD’22 Net Debt to EBITDA $447 $449 Net Debt(1) ($M) $400 0.9x Cash from Operations $102 $37 $221 $80 $310 0.8x Capital Expenditures ($30) ($15) ($58) ($34) $200 0.8x 0.6x 0.7x
Slide 11: Fiscal 2023 Financial Outlook
Fiscal 2023 Financial Outlook FY23 Total Company Outlook FY23 Segment Sales Outlook Prior (Q1’23) Current Current Total Sales Growth +1% to +5% +2% to +6% Mobile Solutions +1% to +5% Gross Margin YoY expansion YoY expansion Off-Road + High-single digits Adj. Operating On-Road + Mid-single digits 14.
Slide 12: Appendix
Appendix ™ Donaldson. Oy FILTRATION SOLUTIONS
Slide 13: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures ($ in millions, except per share amounts) (Unaudited) Amounts may not sum due to rounding 13
Slide 14: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures ($ in millions, except per share amounts) (Unaudited) January 31, 2023 2022 2021 Total debt $ 628.8 $ 617.8 $ 517.5 Less: Cash and cash equivalents (179.4) (170.4) (207.3) Net debt $ 449.4 $ 447.4 $ 310.2 Twelve months ended January 31, 2023 2022 2021 Ad