NYSE$DCI

Donaldson Company · Q1 2021 earnings

Q1 2021 earnings · · Investor relations

Briefing

Donaldson's Q1 2021 earnings were reported, showing a slight decrease in net sales and earnings per share compared to the previous year.

Donaldson Company reported a decrease in net sales by 5.4% to $636.6 million and a decline in earnings per share by 4.4% to $0.48 for the first quarter of 2021. Despite these declines, the company saw growth in gross margin and managed to mitigate the impact of the pandemic through replacement parts sales and newly established customer relationships in China.

  • First quarter sales decreased by 5.4% to $636.6 million.
  • Earnings per share declined by 4.4% to $0.48.
  • Operating margin increased by 0.5 percentage points, driven by gross margin.
  • Sales trends are expected to improve, with year-over-year growth anticipated in the second half of fiscal 2021.

Headline financials

Total Revenue

$637M

Previous: $673M-5.4%
EPS (adj)

$0.48

Previous: $0.51-5.9%
Gross Margin

35.0%

Previous: 34.4%+1.7%
Operating Margin

13.7%

Previous: 13.2%+3.8%
Effective Tax Rate

24.7%

Previous: 24.9%-0.8%
Capital Expenditures

-$18.8M

Previous: -$37.1M+49.3%
Free Cash Flow

$110M

Previous: $49M+124.7%
Net Income

$61.9M

Previous: $65M-4.8%
Operating Income

$87.2M

Previous: $88.7M-1.7%
Gross Profit

$223M

Previous: $231M-3.7%
Cash & Equivalents

$270M

Previous: $210M+28.6%
Total Assets

$2.27B

Previous: $2.28B-0.6%
Stock-Based Comp

$6.3M

Previous: $6.6M-4.5%

Revenue & EPS history

Donaldson · Revenue · Quarterly

$637M

Q1 2021-5.4%vs Q1 2020
Beat estimate in 11 of 16 quarters(69%)
ActualEstimate

Forward guidance

Donaldson expects second quarter sales to be up sequentially from the first quarter, with a year-over-year change between a 4 percent decline and a 1 percent increase. Sales in the second half of fiscal 2021 are expected to increase. The company plans to keep full-year 2021 operating expense as a rate of sales roughly flat with 2020. They expect to repurchase at least 1 percent of its outstanding shares.

Tailwinds

  • Second quarter sales are expected to be up sequentially from first quarter
  • Sales in the second half of fiscal 2021 are expected to increase
  • Gross margin is expected to increase as year-over-year sales trends improve
  • The Company plans to keep full-year 2021 operating expense as a rate of sales roughly flat with 2020
  • Free cash flow conversion is still expected above 100 percent

Headwinds

  • Continued uncertainty related to the COVID-19 pandemic
  • Incremental benefits from raw material costs and a favorable mix of sales are expected to be lower
  • Higher incentive compensation
  • Continued investments in strategic priorities
  • Capital expenditures are still planned meaningfully below fiscal 2020

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2021

Historical avgQ1 2021

-0.0%

Avg return

Earnings day

-0.3%

Avg return

5 days after

-1.4%

Avg return

30 days after

54%

36 / 67 earnings

Positive

+10.1%

Q4 2018

Best reaction

-11.7%

Q2 2026

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026-11.7%-10.9%-19.7%
Q1 2026+7.6%+2.9%+2.7%
Q4 2025+8.5%+5.3%+7.1%
Q3 2025-0.1%+1.7%+3.0%
Q2 2025-2.4%-2.5%-3.1%
Q1 2025-6.0%-6.6%-13.8%
Q4 2024-3.9%-2.3%-0.8%
Q3 2024+3.7%+1.7%-1.2%
Q2 2024+6.7%+8.3%+11.2%
Q1 2024+3.5%+5.3%+11.2%
Q4 2023+4.0%+5.8%-2.5%
Q3 2023-7.7%-8.9%-2.5%
Q2 2023+4.9%+4.5%+3.3%
Q1 2023+3.1%+0.7%-0.5%
Q4 2022-2.3%-3.9%-7.4%
Q3 2022+2.6%+1.9%-7.1%
Q2 2022+0.2%-7.5%+0.2%
Q1 2022+0.9%+2.2%+5.0%
Q4 2021-7.5%-9.5%-12.8%
Q3 2021+2.4%+0.5%+2.8%
Q2 2021-4.9%-4.4%-4.9%
Q1 2021+3.0%+3.0%+5.2%
Q4 2020-7.8%-10.3%-7.0%
Q3 2020+3.5%+7.2%-3.6%
Q2 2020-4.9%-4.1%-25.9%
Q1 2020-2.8%+0.7%+5.1%
Q4 2019+7.4%+8.7%+8.2%
Q3 2019+0.7%+1.2%+4.0%
Q2 2019-5.9%-4.6%+1.9%
Q1 2019-9.3%-13.7%-26.1%
Q4 2018+10.1%+13.1%+13.6%
Q3 2018-2.9%-1.2%-5.2%
Q2 2018-5.7%-3.1%-4.7%
Q1 2018-0.2%-0.7%+0.9%
Q4 2017-6.7%-5.1%-0.5%
Q3 2017-2.6%-5.8%-5.0%
Q2 2017+5.1%+5.0%+6.0%
Q1 2017+6.8%+8.6%+3.7%
Q4 2016-1.9%-2.8%-2.1%
Q3 2016+8.6%+9.4%+3.5%
Q2 2016+7.5%
Q1 2016+3.1%
Q4 2015-1.6%
Q3 2015+2.2%
Q2 2015-2.0%
Q1 2015-7.6%
Q4 2014+3.6%
Q3 2014-7.0%
Q2 2014-2.7%
Q1 2014+0.0%
Q4 2013-3.5%
Q3 2013+1.8%
Q2 2013-2.8%
Q1 2013+5.7%
Q4 2012+1.4%
Q3 2012+6.0%
Q2 2012-3.5%
Q1 2012-2.8%
Q4 2011+2.4%
Q4 2009+2.4%
Q4 2010+2.4%
Q3 2010-2.9%
Q3 2011-2.9%
Q2 2011+1.2%
Q2 2010+1.2%
Q1 2011+0.0%
Q1 2010+0.0%

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