Donaldson Company, Inc. · NYSE:DCI
Donaldson — Q1 2024 Earnings Presentation
15 slides from Donaldson's earnings presentation, Nov 29, 2023
Slide 1: First Quarter Fiscal Year 2024
DONALDSON COMPANY FIRST QUARTER FISCAL YEAR 2024 NOVEMBER 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 L
Slide 3: First Quarter Fiscal Year 2024 Update and Overview
First Quarter Fiscal Year 2024 Update and Overview Strong Operational Performance Drives Solid Start to Fiscal Year ✓ Delivered nearly decade-high gross margin Key ✓ Robust growth in Industrial Solutions Updates ✓ Executing on strategic priorities and operational efficiencies ✓ Returned $84M to shar
Slide 4: First Quarter FY24 Overview & Highlights
First Quarter FY24 Overview & Highlights Sales ($M) Adjusted Operating Margin(1) Adjusted Diluted EPS(1) Down 1.6% YoY Constant Currency Basis Down 30 bps YoY Flat YoY $0.75 $0.75 $847 $846 15.0% 14.7% Q1’23 Q1’24 Q1’23 Q1’24 Q1’23 Q1’24 Highlights Highlights Highlights • ~3% YoY contribution from p
Slide 5: Mobile Solutions Segment First Quarter FY24 Results
Mobile Solutions Segment First Quarter FY24 Results First Quarter Overview Sales • Total Sales YoY: -3% reported; -4% constant currency basis • Performance continued to be mixed • OEM customer destocking continued in response to normal global supply chain conditions • Performance by region YoY: • US
Slide 6: Industrial Solutions Segment First Quarter FY24 Results
Industrial Solutions Segment First Quarter FY24 Results First Quarter Overview Sales • Total Sales YoY: +7% reported; +6% constant currency basis • Sales growth driven by strong global demand and market share gains • Performance by region YoY: • US/CA +9% • EMEA +12% Q1’24 Q1’23 YoY • APAC -12% • LA
Slide 7: Delivering Growth in Industrial Solutions
Delivering Growth in Industrial Solutions Recent Customer Wins Continuing to penetrate key end create connect replace service markets and drive geographic expansion: • Power generation - Large turbine projects in Asia, Middle East • Aerospace & Defense • EMEA Service organization - Cabin air filtrat
Slide 8: Expanding Connected Solutions
Expanding Connected Solutions Connected Model • Strong YoY growth in new connections • Supporting expansion with new customers in the Aftermarket • Generating additional growth within our Service offerings • Launched in India, Thailand and China in FY23 • Developing new solutions for hydraulics and
Slide 9: Life Sciences Segment First Quarter FY24 Results
Life Sciences Segment First Quarter FY24 Results First Quarter Overview Sales • Total Sales YoY: -4% reported; -7% constant currency basis • Lower sales driven by ongoing softness in Disk Drive market demand • Performance by region YoY: • US/CA -8% • EMEA +13% Q1’24 Q1’23 YoY • APAC -17% • LATAM +22
Slide 10: Balance Sheet and Cash Flow Overview
Balance Sheet and Cash Flow Overview Net Debt and Financial Leverage $600 1.2x Net Debt(2) ($M) $440 Net Debt to Adj. $434 Highlights $388 EBITDA(2) $400 0.9x 0.8x $200 0.7x 0.6x • Free cash flow conversion of 125% in 0.7x Q1’24 • Above average conversion driven $0 0.3x by operating performance and
Slide 11: Fiscal 2024 Financial Outlook
Fiscal 2024 Financial Outlook Total Company Sales Growth Segment Outlook Total Sales +1% to 5% +3% to 7% Off-Road - Mid-single digits On-Road Flat Total Company Gross Margin Aftermarket + Mid-single digits YoY expansion Mobile Solutions Total Sales +3% to 7% Industrial + Mid-single digits Total Comp
Slide 12: Invest with Donaldson
Invest with Donaldson Investing in leading technologies to accelerate growth across 1 several opportunities including sustainability trends Strengthening position across industries with favorable megatrends 2 that provide long-term growth tailwinds Increasing level of investment directed toward high
Slide 13: Appendix
Ol y naldson. 13 Appendix
Slide 14: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures ($ in millions, except per share amounts) (Unaudited) 14
Slide 15: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures ($ in millions, except per share amounts) (Unaudited) 15