Donaldson Raises Sales Growth Outlook - Quick Facts

(RTTNews) - Donaldson Company, Inc. (DCI) announced, for fiscal 2018, the company increased the midpoint of its sales guidance range, with sales now expected to grow between 13 and 15 percent, compared with 10 to 14 percent in prior guidance. The total sales forecast includes benefits of approximately 3 percent from currency translation and 1 percent from acquisitions completed in fiscal 2017. Sales of Engine Products are now expected to increase between 17 and 19 percent, compared with prior forecast of 13 to 17 percent.

Donaldson expects fiscal 2018 adjusted EPS between $1.93 and $2.01, consistent with prior guidance at the midpoint. Fiscal 2018 GAAP EPS is expected to be approximately $0.83 lower than adjusted EPS, reflecting charges taken in second quarter 2018 related to the TCJA.

Donaldson expects fiscal 2018 operating margin between 13.8 and 14.2 percent, or 0.3 percentage points below prior guidance due to increased pressure on gross margin. The company expects fiscal 2018 capital expenditures of $90 million to $100 million. Excluding one-time charges related to the TCJA, Donaldson's fiscal 2018 effective income tax rate will be 26.5 to 28.5 percent. Donaldson plans to repurchase approximately 2 percent of its outstanding shares in fiscal 2018.

Excluding the TCJA charge, Donaldson delivered second quarter adjusted earnings per share of $0.43, an increase of 22.9 percent from 2017. Sales increased 20.7 percent to $664.7 million from $550.6 million last year. The year-over-year increase includes a benefit of approximately 4.6 percent from currency translation and 1.5 percent from acquisitions completed by the company during fiscal 2017. Compared with the prior year, second quarter sales increased 22.3 percent in the Engine Products segment.