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D O N AL D S O N C O M P AN YFOURTH QUARTER FISCAL YEAR 2026A U G U S T 2 0 2 6
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Forward-Looking Statement Safe Harbor 2 Statements in this presentation regarding future events and expectations, such as forecasts, plans, trends, and projections relating tothe Company’s business and financial performance, are forward-looking statements within the meaning of the Private SecuritiesLitigation Reform Act of 1995 and are identified by words or phrases such as “will likely result,” “are expected to,” “will continue,” “willallow,” “estimate,” “project,” “believe,” “expect,” “anticipate,” “forecast,” “plan” and similar expressions. These forward-lookingstatements speak only as of the date such statements are made and are subject to risks and uncertainties that could affect theCompany’s performance and could cause the Company’s actual results for future periods to differ materially from any opinions orstatements expressed. These factors include, but are not limited to, challenges in global operations; impacts of global economic,industrial and political conditions on product demand; impacts from unexpected events; effects of unavailable raw materials,significant demand fluctuations or material cost changes; inability to attract and retain qualified personnel; inability to meet customerdemand; inability to maintain competitive advantages; threats from disruptive technologies; effects of highly competitive markets withpricing pressure; exposure to customer concentration in certain cyclical industries; inability to manage productivity improvements;inability to achieve commitments related to sustainability, results of execution of any acquisition, divestiture and other strategictransactions; risks relating to the Facet acquisition; inability to achieve the intended outcomes of AI technologies development;vulnerabilities associated with information technology systems and security; inability to protect and enforce intellectual property rights;costs associated with governmental laws and regulations; impacts of foreign currency fluctuations; and effects of changes in capitaland credit markets. These and other factors are described in Part I, Item 1A, “Risk Factors” of the Company’s Annual Report on Form10-K for the fiscal year ended July 31, 2025. The Company undertakes no obligation to publicly update or revise any forward-lookingstatements, whether as a result of new information, future events or otherwise, unless required by law. The results presented hereinare preliminary, unaudited and subject to revision until the Company files its results with the United States Securities and ExchangeCommission on Form 10-K.Non-GAAP Financial MeasuresThis presentation contains non-GAAP financial measures, such as adjusted diluted EPS, adjusted gross margin, adjusted operatingexpense, adjusted EBIT, adjusted operating income, adjusted operating margin, and free cash flow, which exclude the impact ofcertain matters not related to ongoing operations. See the Reconciliation of Non-GAAP Financial Measures schedules in theappendix for additional information.
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Invest with Donaldson 3 3Best-in-class technology and strategic organizational redesign strengthens ability to drive long-term profitable growth1Enablers of a greener modern economy by helping customers achieve their sustainability goals through advanced filtration2Clear strategic and balanced growth strategy focused on expanding leadership position in legacy markets and further penetrating new marketsProgress towards Life Sciences market leadership and exposure to mega trends provides significant addressable market and long-term profitable growth potential4Leader in filtration with long history of solving the most difficult filtration problems and forming mission critical partnerships across global customer base 5
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Fourth Quarter FY26 Update and Overview 1 All EPS figures refer to diluted EPS.2 Adjusted for restructuring and other and business development charges. See the reconciliation of Non-GAAP Financial measures appendix for additional information.3 Free cash flow = cash from operations minus capital expenditures; Adjusted free cash flow conversion = free cash flow / adjusted net earnings.4 FY 2027 Guidance Positioning for Long-Term GrowthDelivered record fourth quarterwith all-time high sales, adjusted operating margin and adjusted earningsAchieved a notable sequential step-up in margin performance, particularly in Industrial Solutions, as expectedFacetaddingsales and favorable mix to enterprise gross marginMaintained expense discipline and drove operating leverage Returned $37M to shareholders in fourth quarterthrough dividends, paid down $102 million of Facet-related debt and returned $250M to shareholders in FY26 through dividends and share repurchasesKey Updates Fourth Quarter FinancialsRobust Execution Across all Three SegmentsSales of $1.1B increased 8% YoY•Pricing benefit of 2% Adjusted EPS(1,2) of $1.15 increased 11.7% YoY •Adjusted gross margin(2) increased 190 bps YoY•Adjusted operating margin(2) increased 110 bps YoYAdjusted free cash flow conversion(2,3) of 136%Issuing Record Fiscal 2027 GuidanceSales outlook centered on $4.2B or between 5.5% to 9.5% growthAdjusted operating margin of 16.6% to 17.2%EPSguidance bracketing $4.30 and within a range of $4.22 to $4.38
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Full-Year FY26 Overview & Highlights 5 Sales ($M)Up 3% YoY Constant Currency BasisHighlights•+2% YoY contribution from price•Segment Performance YoY:•Mobile Solutions +6%•Industrial Solutions +3%•Life Sciences +13% Adjusted Operating Margin(1)Highlights•Adjusted gross margin(1)increased 10 bps versus prior year driven by pricing and volume growth, partially offset by operating inefficiencies within the Industrial segment.•Adjusted operating expenses as a percentage of sales(1)decreased 20 bps YoY from continued expense discipline Adjusted Diluted EPS(1)Highlights•Adjusted operating income(1) increased 7% YoY$3,691$3,886FY25FY2615.7%16.0%FY25 FY26$3.68 $3.98 1 21 Adjusted for restructuring and other, business development charges, impairment of intangible assets and a gain on the sale of fixed assets. See the reconciliation of Non-GAAP Financial Measures appendix for additional information. +5%FY25 FY26+30bps+8%
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Fourth Quarter FY26 Overview & Highlights 6 Sales ($M)Up 7% YoY Constant Currency BasisHighlights•+2% YoY contribution from price•+3% YoY contribution from Facet•Segment Performance YoY:•Mobile Solutions +8%•Industrial Solutions +8%•Life Sciences +10% Adjusted Operating Margin(1)Highlights•Adjusted gross margin(1) up 190 bps YoY , due to higher volume, pricing, and mix, partially offset by input cost inflation and operational inefficiencies•Adjusted operating expenses as a percent of sales(1) increased 80 bps YoY Adjusted Diluted EPS(1)Highlights•Adjusted operating income(1) increased15% YoY$981$1,059+8%Q4’25 Q4’2617.5%16.4%Q4’25 Q4’26$1.03 $1.15 Q4’25 Q4’261 Adjusted for restructuring and other and business development charges. See the reconciliation of Non-GAAP Financial Measures appendix for additional information. +110bps+12%
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YoYQ4’25Q4’26+8%$588$635Sales +21%$112$136EBT+220 bps19.1%21.3%% of sales Mobile Solutions Segment Fourth Quarter FY26 Results EBT = earnings before income taxes7 Fourth Quarter OverviewSales•Total Sales YoY: +8% reported and +8% on a constant currency basis•Sales increase driven by strong volume growth and pricing•Aftermarket sales driven by growth in all regions and in both OE and independent channels•Off-road sales were flat with Construction sales growth offsetting muted performance in Agriculture•On-road sales increased due to truck production ramp, particularly in the US and Europe•Performance by region YoY:•US/CA +9%•EMEA +3%•APAC +14%•LATAM +9%Margins and Key Updates•Segment EBT margin +220 bps YoY primarily due to volume leverage, pricing and mix related to Aftermarket sales strength
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YoYQ4’25Q4’268%$310$334Sales -15%$65$55EBT-450 bps20.9%16.4%% of sales Industrial Solutions Segment Fourth Quarter FY26 Results 8EBT = earnings before income taxes Sales•Total Sales YoY: +8% reported and +5% on a constant currency basis•Sales increase driven by the inclusion of Facet•Industrial Filtration Solutions sales decreased due to lower dust collection new equipment volumes, partially offset by robust Power Generation new equipment sales•Aerospace and Defense sales increased from the inclusion of Facet, Organic Aerospace and Defense sales declined due to ongoing supply chain issues•Performance by region YoY:•US/CA +9%•EMEA +11%•APAC -4%•LATAM -4%•Performance by end-market YoY: •Industrial Filtration Solutions -2%•Aerospace and Defense +61%Margins and Key Updates•Segment EBT margin -450 bps YoY due to Facet run-rate expenses, organic expense deleveraging, and headwinds associated with Power Generation production shifts Fourth Quarter Overview
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Life Sciences Segment Fourth Quarter FY26 Results 9 YoYQ4’25Q4’26+10%$82$90Sales NM$4$11EBT+660 bps5.3%11.9%% of salesSales•Total Sales YoY: +10% reported and +10% constant currency basis•Higher sales driven by double-digit growth in Disk Drive and solid Food and Beverage new equipment sales•Performance by region YoY:•US/CA -1%•EMEA +14%•APAC +10%•LATAM +7%Margins and Key Updates•Segment EBT margin +660 bps YoY due to volume leverage from our higher-margin Food and Beverage and Disk Drive businesses and continued expense discipline•Beginning in the first quarter of FY27, segment will be renamed Process FiltrationEBT = earnings before income taxes, NM = not meaningful Fourth Quarter Overview
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Balance Sheet and Cash Flow Overview 1 Adjusted for restructuring and other, business development charges, impairment of intangible assets and a gain on the sale of fixed assets. See the Reconciliation of Non-GAAP Financial Measures appendix for additional information.2 Free cash flow = cash from operations minus capital expenditures; Adjusted free cash flow conversion = free cash flow / adjusted net earnings.1 0 $304$488$1,0740.5x0.7x1.4x0.4x0.7x1.0x1.3x1.6x$0$200$400$600$800$1,000FY24 FY25 FY26 Net Debt to Adj. EBITDA(1) Net Debt(1) ($M)Net DebtNet Debt to Adj. EBITDANet Debt and Financial LeverageConsolidated Results($M) Highlights•Adjusted free cash flow conversion(1,2) of 136% in Q4’26; 91% in FY26•Supported by continued efficient management of working capital•Paid down $102 million of Facet-related debt in Q4’26•Returned $250 million to shareholders in dividends and share buybacks in FY26 •Strong cash flow supports growth, strategic investments, and debt paydown FY25FY26Q4’25Q4’26$419$494$168$200Cash from Operations ($77)($57)($18)($15)Net Capital Expenditures$342$427$150$185Free Cash Flow(2) ($132)($141)($35)($37)Dividends($332)($109)($60)-Share Buybacks
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Fiscal 2027 Financial Outlook 1 1 2% to 6%Total Sales+ Mid-single digitsOff-Road+ High-single digitsOn-Road+ Mid-single digitsAftermarket Mobile Solutions+ Mid-teensTotal Sales+ Mid-single digitsIndustrial Filtration Solutions+ >50% (w/Facet)Aerospace & Defense+ Mid-teens (Organic) Industrial Solutions7% to 11%Total Sales Life Sciences Other Assumptions•Tax rate of 23.5% to 25.5%•Pricing benefit of approximately 2%•Facet sales benefit of approximately 2%•Interest expense between $55M to $60M•Other income between $16M to $20M •Foreign currency benefit of 1% Segment OutlookTotal Company Sales GrowthTotal Company Gross MarginTotal Company Operating MarginDilutedEPSCapital ExpendituresFCFConversion +5.5% to 9.5%YoY Expansion16.6% to 17.2%$4.22 to $4.38$70M to $90M95% to 105%
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Appendix1 2
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1 3 Reconciliation of Non-GAAP Financial Measures ($ in millions, except per share amounts)(Unaudited)
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1 4 Reconciliation of Non-GAAP Financial Measures ($ in millions, except per share amounts)(Unaudited)