Donaldson Company, Inc. has recently released its 10-K report for the year ended July 31, 2024. The company, founded in 1915 and headquartered in Bloomington, Minnesota, is a global leader in technology-led filtration products and solutions. It operates through three segments: Mobile Solutions, Industrial Solutions, and Life Sciences, serving a broad range of industries and advanced markets.
In the year ended July 31, 2024, Donaldson reported net sales of $3,586.3 million, compared to $3,430.8 million in the previous year. The cost of sales was $2,311.9 million, resulting in a gross profit of $1,274.4 million, representing 35.5% of net sales. The company reported operating income of $544.1 million, an increase from $480.2 million in the previous year. Net earnings for the year were $414.0 million, compared to $358.8 million in the previous year, with diluted earnings per share of $3.38, up from $2.90 in the previous year.
Geographically, the U.S. and Canada contributed $1,583.1 million to net sales, representing 44.1% of total net sales, followed by Europe, Middle East, and Africa (EMEA) with $1,012.9 million, Asia Pacific (APAC) with $601.5 million, and Latin America (LATAM) with $388.8 million.
The Mobile Solutions segment reported net sales of $2,250.8 million, a 3.5% increase from the previous year, driven by volume and pricing benefits. The Industrial Solutions segment reported net sales of $1,066.5 million, a 5.1% increase from the previous year, and the Life Sciences segment reported net sales of $269.0 million, an 11.5% increase from the previous year.
The company's gross margin as a percentage of net sales was 35.5%, representing an increase of 1.7 percentage points from the previous year, primarily driven by lower input costs, pricing actions, and favorable product mix. Selling, general, and administrative expenses were $636.7 million, representing 17.8% of net sales, and research and development expenses were $93.6 million, representing 2.6% of net sales.
Donaldson's net earnings were impacted by fluctuations in foreign currency exchange rates. The impact of these fluctuations on net earnings was calculated at $0.8 million for the year ended July 31, 2024, compared to $14.4 million for the year ended July 31, 2023.
The company also undertook restructuring initiatives during the year, resulting in restructuring expenses of $6.4 million. Net earnings were positively impacted by an increase in excess tax benefits on stock-based compensation, resulting in an effective tax rate of 22.7% for the year ended July 31, 2024.
As a result of these announcements, the company's shares have moved -0.2% on the market, and are now trading at a price of $73.84. If you want to know more, read the company's complete 10-K report here.
