Q1 2026 Donaldson Company Inc Earnings Call Transcript
Key Points
- Donaldson Co Inc (DCI) achieved a record first-quarter sales of $935 million, marking a 4% year-over-year increase.
- The company expanded its operating profit margin to a record 15.5%, driven by higher sales and cost optimization initiatives.
- Donaldson Co Inc (DCI) delivered record earnings per share of $0.94, which is 13% above the prior year.
- The company returned $127 million to shareholders through share repurchases and dividends.
- Strong performance in key segments such as mobile aftermarket, power generation, and food and beverage, with significant market share gains in these areas.
- Gross margin decreased by 20 basis points from the prior year, despite efforts to offset increased operating costs with pricing.
- Industrial solutions pre-tax margin decreased to 12.5% from 15.9% in the previous year due to unfavorable sales mix and loss of leverage on operating costs.
- Aerospace and defense sales decreased by 7% due to softer defense sales following the completion of large projects.
- On-Road sales within Mobile Solutions declined by 27% due to decreased global truck production.
- The company faces ongoing cyclical headwinds in its largest first-fit business, Off-Road, despite some growth in construction.
Hello, and thank you for standing by. My name is Tiffany, and I will be your conference operator today. At this time, I would like to welcome everyone to the Donaldson Company Q1 FY26 earnings webcast. (Operator Instructions)
I would now like to turn the call over to Sarika Dhadwal, Head of Investor Relations. Sarika, please go ahead.
Good morning. Thank you for joining Donaldson's first quarter fiscal 2026 earnings conference call. With me today are Tod Carpenter, Chairman, President, and CEO; Brad Pogalz, Chief Financial Officer; and Rich Lewis, Chief Operating Officer.
This morning, Todd and Brad will provide a summary of our first quarter performance and our outlook for fiscal 2026. During today's call, we will discuss non-GAAP or adjusted results. First quarter 2026 non-GAAP results exclude a pre-tax gain on the sale of fixed assets of $9.3 million and a pre-tax charge of $5 million for restructuring and other charges primarily related to footprint optimization and cost reduction
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