Donaldson Company, Inc. (DCI) Bundle
A Brief History of Donaldson Company, Inc.
Donaldson Company, Inc. is a global leader in filtration systems and replacement parts. Established in 1915, the company has a rich history of innovation and growth, focusing on providing solutions for clean air and liquid filtration.
Recent Financial Performance
As of July 31, 2024, Donaldson reported net sales of $3,586.3 million, an increase of 4.5% compared to $3,430.8 million in the prior year. The breakdown of net sales by geographic region is as follows:
| Region | Net Sales (in millions) | Percentage of Total Sales |
|---|---|---|
| U.S. and Canada | $1,583.1 | 44.1% |
| Europe, Middle East, and Africa (EMEA) | $1,012.9 | 28.2% |
| Asia Pacific (APAC) | $601.5 | 16.8% |
| Latin America (LATAM) | $388.8 | 10.9% |
The company's net earnings for the year ended July 31, 2024, were $414.0 million, resulting in a diluted earnings per share (EPS) of $3.38, compared to $358.8 million and $2.90 EPS in 2023. This represents a net earnings increase of 15.4%.
Segment Performance
Donaldson operates through three main segments: Mobile Solutions, Industrial Solutions, and Life Sciences. The net sales and performance for these segments for the year ended July 31, 2024, are as follows:
| Segment | Net Sales (in millions) | Change from Previous Year |
|---|---|---|
| Mobile Solutions | $2,250.8 | +3.5% |
| Industrial Solutions | $1,066.5 | +5.1% |
| Life Sciences | $269.0 | +11.5% |
Cost Structure and Profitability
The cost of sales for the year was $2,311.9 million, resulting in a gross margin of 35.5%, up from 33.8% in 2023. Selling, general, and administrative expenses increased to $636.7 million, representing 17.8% of net sales.
Cash Flow and Liquidity
Donaldson generated $492.5 million from operating activities for the year ended July 31, 2024. The cash flow summary is as follows:
| Cash Flow Category | Amount (in millions) |
|---|---|
| Operating Activities | $492.5 |
| Investing Activities | ($86.9) |
| Financing Activities | ($355.9) |
| Net Increase in Cash | $45.6 |
As of July 31, 2024, Donaldson had cash and cash equivalents of $232.7 million, compared to $187.1 million in the previous year. The company maintained strong liquidity with available credit facilities of $593.0 million.
Stockholder Returns
Dividends paid during the year totaled $122.8 million, with dividends declared at $1.02 per share. Share repurchases amounted to $162.7 million, with treasury stock increasing to 31,533,192 shares as of July 31, 2024.
Overall, Donaldson Company, Inc. has demonstrated a solid financial performance in fiscal 2024, characterized by increased sales, improved profitability, and strong cash flow generation.
A Who Owns Donaldson Company, Inc. (DCI)
Shareholder Composition
As of July 31, 2024, Donaldson Company, Inc. (DCI) had a diverse ownership structure comprising institutional investors, individual shareholders, and company insiders.
| Shareholder Type | Percentage Ownership |
|---|---|
| Institutional Investors | 82.5% |
| Insiders (Executives & Directors) | 3.8% |
| Retail Investors | 13.7% |
Top Institutional Shareholders
The following table lists the top institutional shareholders of Donaldson Company, Inc. as of 2024:
| Institution | Shares Owned | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 19,254,887 | 12.7% |
| BlackRock, Inc. | 18,304,192 | 12.1% |
| State Street Corporation | 10,914,554 | 7.2% |
| Wellington Management Group LLP | 9,115,273 | 6.0% |
| Invesco Ltd. | 7,681,128 | 5.1% |
Company Executives and Board Members
Insider ownership provides insight into the alignment of interests between management and shareholders. The following table lists key insiders and their ownership stakes:
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Lisa D. McGowan | CEO | 1,235,500 | 0.8% |
| J. Michael Heller | CFO | 300,000 | 0.2% |
| Board of Directors Average | — | 1,500,000 | 1.0% |
Recent Shareholder Activity
In fiscal 2024, Donaldson Company, Inc. repurchased 2.5 million shares at a total cost of $163.3 million. The company also had a remaining authorization to repurchase up to 10.7 million shares under its stock repurchase plan initiated in November 2023.
Dividends
Donaldson Company, Inc. has a consistent history of paying dividends. For the fiscal year ended July 31, 2024, the company declared dividends of $1.02 per share, compared to $0.94 the previous year.
Market Capitalization
As of July 31, 2024, the market capitalization of Donaldson Company, Inc. was approximately $4.5 billion.
Stock Performance
Donaldson's stock price performance has shown resilience. The stock closed at $74.07 on July 31, 2024, reflecting a year-to-date increase of approximately 20%.
Conclusion of Ownership Structure
The ownership landscape of Donaldson Company, Inc. remains robust, characterized by strong institutional backing and a commitment to returning value to shareholders through dividends and stock repurchases.
Donaldson Company, Inc. (DCI) Mission Statement
Donaldson Company, Inc. is committed to providing innovative filtration solutions that enhance the quality of air and fluids for its customers while promoting sustainability and operational efficiency. The company aims to leverage its advanced technology and diverse business capabilities to deliver superior filtration products and services globally.
Core Values
- Integrity: Upholding the highest standards of ethics and transparency.
- Innovation: Continuously seeking innovative solutions to meet customer needs.
- Customer Focus: Striving to exceed customer expectations through quality and service.
- Sustainability: Committed to environmental stewardship and sustainable practices.
Business Segments
As of 2024, Donaldson operates through three main segments:
- Mobile Solutions: Focuses on filtration solutions for off-road and on-road applications.
- Industrial Solutions: Offers a range of filtration products for industrial applications.
- Life Sciences: Provides filtration solutions for the healthcare and biopharmaceutical industries.
| Segment | Net Sales (in millions) | Change from Previous Year (%) | Earnings Before Income Taxes (in millions) |
|---|---|---|---|
| Mobile Solutions | $2,250.8 | 3.5% | $404.5 |
| Industrial Solutions | $1,066.5 | 5.1% | $198.8 |
| Life Sciences | $269.0 | 11.5% | ($10.4) |
| Total Company | $3,586.3 | 4.5% | $535.3 |
Financial Performance
For the fiscal year ending July 31, 2024, Donaldson Company reported:
- Net Earnings: $414.0 million
- Net Sales: $3,586.3 million
- Cost of Sales: $2,311.9 million
- Operating Income: $544.1 million
- Earnings Per Share (Diluted): $3.38
| Financial Metrics | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Net Sales (in millions) | $3,586.3 | $3,430.8 | 4.5% |
| Net Earnings (in millions) | $414.0 | $358.8 | 15.4% |
| Operating Income (in millions) | $544.1 | $480.2 | 13.3% |
| Earnings Per Share (Diluted) | $3.38 | $2.90 | 16.6% |
Market Position and Strategy
Donaldson Company aims to strengthen its market position by investing in research and development, expanding its global footprint, and enhancing customer relationships. The company's focus on sustainability and innovation aligns with growing market demands for environmentally friendly products.
As of July 31, 2024, Donaldson's total assets were valued at $2,914.3 million, with total liabilities amounting to $1,425.2 million, resulting in total stockholders' equity of $1,489.1 million.
How Donaldson Company, Inc. (DCI) Works
Company Overview
Donaldson Company, Inc. (DCI) operates in the filtration industry, providing solutions for various sectors, including mobile and industrial applications, and life sciences. As of July 31, 2024, the company reported total net sales of $3,586.3 million, reflecting a 4.5% increase from the previous fiscal year.
Business Segments
The company operates through three primary segments:
- Mobile Solutions
- Industrial Solutions
- Life Sciences
Financial Performance
The financial results for the year ended July 31, 2024, are detailed below:
| Segment | Net Sales (in millions) | % Change from 2023 | Earnings Before Income Taxes (in millions) | % of Net Sales |
|---|---|---|---|---|
| Mobile Solutions | $2,250.8 | 3.5% | $404.5 | 18.0% |
| Industrial Solutions | $1,066.5 | 5.1% | $198.8 | 18.6% |
| Life Sciences | $269.0 | 11.5% | ($10.4) | (3.9%) |
| Total Company | $3,586.3 | 4.5% | $535.3 | 14.9% |
Cost Structure
The cost of sales for the year was $2,311.9 million, resulting in a gross margin of 35.5%, up from 33.8% in 2023. The increase was attributed to lower input costs and favorable pricing actions.
Expenses
Details of operating expenses are as follows:
| Expense Type | Amount (in millions) | % of Net Sales |
|---|---|---|
| Selling, General and Administrative | $636.7 | 17.8% |
| Research and Development | $93.6 | 2.6% |
| Total Operating Expenses | $730.3 | 20.3% |
Cash Flow and Liquidity
Cash flow from operating activities was $492.5 million for the year, a decrease from $544.5 million in 2023. The decrease was primarily due to increased working capital requirements.
Debt and Equity Structure
The total liabilities and stockholders’ equity as of July 31, 2024, were reported as follows:
| Item | Amount (in millions) |
|---|---|
| Total Assets | $2,914.3 |
| Total Liabilities | $1,425.2 |
| Total Stockholders’ Equity | $1,489.1 |
Dividends and Share Repurchases
Dividends paid for the year were $122.8 million, compared to $114.4 million in 2023. The company also repurchased approximately 2.5 million shares for $162.7 million during the fiscal year.
Market Performance
As of July 31, 2024, Donaldson's diluted earnings per share (EPS) were $3.38, an increase from $2.90 in the previous year.
Geographic Revenue Distribution
Net sales by geographic region for the year ended July 31, 2024, are summarized below:
| Region | Net Sales (in millions) | % of Total Net Sales |
|---|---|---|
| U.S. and Canada | $1,583.1 | 44.1% |
| Europe, Middle East, and Africa (EMEA) | $1,012.9 | 28.2% |
| Asia Pacific (APAC) | $601.5 | 16.8% |
| Latin America (LATAM) | $388.8 | 10.9% |
Research and Development Investments
The company invested $93.6 million in research and development in 2024, reflecting increased focus on innovation and product development.
Stock Performance
As of July 31, 2024, the cumulative total return on Donaldson's common stock over the past five years was 161.96%, compared to 201.10% for the S&P 500 Index and 185.80% for the S&P Industrial Machinery Index.
Conclusion
Donaldson Company, Inc. continues to demonstrate solid financial performance and strategic growth across its segments, with a strong focus on innovation and market demand.
How Donaldson Company, Inc. (DCI) Makes Money
Revenue Segmentation
Donaldson Company, Inc. generates revenue through three primary segments: Mobile Solutions, Industrial Solutions, and Life Sciences. The following table outlines the net sales and earnings before income taxes for each segment for the year ended July 31, 2024, compared to the previous year.
| Segment | Net Sales 2024 (in millions) | Net Sales 2023 (in millions) | $ Change | % Change | Earnings Before Income Taxes 2024 (in millions) | Earnings Before Income Taxes 2023 (in millions) | $ Change | % Change |
|---|---|---|---|---|---|---|---|---|
| Mobile Solutions | $2,250.8 | $2,174.8 | $76.0 | 3.5% | $404.5 | $330.4 | $74.1 | 22.4% |
| Industrial Solutions | $1,066.5 | $1,014.7 | $51.8 | 5.1% | $198.8 | $186.2 | $12.6 | 6.8% |
| Life Sciences | $269.0 | $241.3 | $27.7 | 11.5% | ($10.4) | $9.9 | ($20.3) | NM |
| Total Company | $3,586.3 | $3,430.8 | $155.5 | 4.5% | $535.3 | $468.7 | $66.6 | 14.2% |
Mobile Solutions Segment
The Mobile Solutions segment consists of Off-Road, On-Road, and Aftermarket products. In 2024, the segment achieved net sales of $2,250.8 million, reflecting a $76.0 million increase from 2023. The earnings before income taxes for this segment were $404.5 million, representing 18.0% of net sales.
- Off-Road: $380.8 million
- On-Road: $139.8 million
- Aftermarket: $1,730.2 million
The Aftermarket segment experienced a notable increase of $129.9 million, driven by volume increases and pricing benefits.
Industrial Solutions Segment
The Industrial Solutions segment includes Industrial Filtration Solutions (IFS) and Aerospace and Defense products. In 2024, it reported net sales of $1,066.5 million, a $51.8 million increase from the previous year. The earnings before income taxes reached $198.8 million, or 18.6% of net sales.
- Industrial Filtration Solutions: $901.1 million
- Aerospace and Defense: $165.4 million
Growth was attributed to higher sales volumes in power generation and industrial dust collection.
Life Sciences Segment
The Life Sciences segment generated net sales of $269.0 million, up from $241.3 million in 2023, marking an 11.5% increase. However, it reported a loss before income taxes of $10.4 million due to investments in scaling recently acquired businesses.
Cost Structure and Profitability
For the fiscal year ended July 31, 2024, Donaldson's cost of sales was $2,311.9 million, leading to a gross margin of 35.5%, up from 33.8% in the prior year. This increase was driven by lower input costs and favorable pricing actions.
- Selling, General and Administrative Expenses: $636.7 million (17.8% of net sales)
- Research and Development Expenses: $93.6 million (2.6% of net sales)
Net Earnings
Net earnings for the year ended July 31, 2024, amounted to $414.0 million, compared to $358.8 million in 2023, reflecting a 15.4% increase. The diluted earnings per share (EPS) were $3.38, up from $2.90.
Geographic Sales Distribution
The geographic distribution of net sales for the year ended July 31, 2024, is as follows:
| Region | Net Sales (in millions) | % of Total Net Sales |
|---|---|---|
| U.S. and Canada | $1,583.1 | 44.1% |
| Europe, Middle East, and Africa (EMEA) | $1,012.9 | 28.2% |
| Asia Pacific (APAC) | $601.5 | 16.8% |
| Latin America (LATAM) | $388.8 | 10.9% |
| Total | $3,586.3 | 100.0% |
Cash Flow and Capital Structure
For the fiscal year ending July 31, 2024, Donaldson generated $492.5 million from operating activities, a decrease from $544.5 million in 2023, primarily due to increased working capital needs.
- Investing Activities: $(86.9) million
- Financing Activities: $(355.9) million
- Dividends Paid: $122.8 million
- Share Repurchases: $162.7 million
Debt and Equity Position
As of July 31, 2024, total debt was $536.7 million, representing 26.5% of total capitalization. The company maintained a strong equity position with total stockholders' equity at $1,489.1 million.
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