Donaldson Company Inc (DCI) 2023 Q2 法說會逐字稿

Good morning. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the Donaldson Company Second Quarter 2023 Earnings Conference Call. (Operator Instructions) Thank you. Sarika Dhadwal, Senior Director of Investor Relations. You may begin your conference.

早上好。我叫艾瑪，今天我將擔任你們的會議接線員。此時，歡迎大家參加唐納森公司 2023 年第二季度收益電話會議。 （操作員說明）謝謝。投資者關係高級總監 Sarika Dhadwal。你可以開始你的會議。

Good morning. Thank you for joining Donaldson's Second Quarter Fiscal 2023 Earnings Conference Call. With me today are Tod Carpenter, Chairman, CEO and President; and Scott Robinson, Chief Financial Officer. This morning, Tod and Scott will provide a summary of our second quarter performance and an update on our outlook for fiscal 2023. As a reminder, we are now reporting our results under three segments: Mobile Solutions, Industrial Solutions and Life Sciences. On January 25, we provided an 8-K showing select historical financial performance under this new segment structure. This 8-K as well as our regular supplemental quarterly earnings presentation can be found on our Investor Relations website at ir.donaldson.com.

早上好。感謝您參加唐納森 2023 財年第二季度收益電話會議。今天和我在一起的是董事長、首席執行官兼總裁 Tod Carpenter；和首席財務官 Scott Robinson。今天上午，Tod 和 Scott 將提供我們第二季度業績的摘要以及我們對 2023 財年展望的更新。提醒一下，我們現在報告三個部分的結果：移動解決方案、工業解決方案和生命科學。 1 月 25 日，我們提供了一份 8-K 表，顯示了在這種新的細分結構下的精選歷史財務業績。可以在我們的投資者關係網站 ir.donaldson.com 上找到此 8-K 以及我們定期補充的季度收益報告。

During today's call, we will discuss non-GAAP or adjusted results. For the second quarter of fiscal 2023, non-GAAP results exclude $9.3 million of nonrecurring pretax restructuring and other charges, largely related to our previously announced organizational redesign as well as costs associated with the exiting of a lower-margin customer program. A reconciliation of GAAP to non-GAAP metrics is provided within the schedules attached to this morning's press release.

在今天的電話會議中，我們將討論非 GAAP 或調整後的結果。對於 2023 財年第二季度，非 GAAP 業績不包括 930 萬美元的非經常性稅前重組和其他費用，這主要與我們之前宣布的組織重新設計以及與退出低利潤客戶計劃相關的成本有關。在今天上午的新聞稿所附的時間表中提供了 GAAP 與非 GAAP 指標的對賬。

Additionally, please keep in mind that any forward-looking statements made during this call are subject to risks and uncertainties, which are described in our press release and SEC filings.

此外，請記住，在本次電話會議期間做出的任何前瞻性陳述都存在風險和不確定性，這些在我們的新聞稿和 SEC 備案文件中有所描述。

With that, I'll now turn the call over to Tod Carpenter. Please go ahead.

有了這個，我現在將電話轉給 Tod Carpenter。請繼續。

Thanks, Sarika. Good morning, everyone. I am pleased to report Donaldson Company's strong second quarter earnings results, significant gross margin expansion, driven by favorable pricing and the continued stabilization of input costs, resulted in an operating margin above 15%. For the second quarter in a row, we achieved an operating margin at a 6-year quarterly high.

謝謝，薩里卡。大家，早安。我很高興地報告唐納森公司第二季度強勁的盈利結果，在優惠定價和投入成本持續穩定的推動下，毛利率大幅增長，營業利潤率超過 15%。我們連續第二個季度實現了 6 年來季度最高的營業利潤率。

This quarter, Donaldson operated under our new organization structure designed to better serve our end market customers, and I am confident and excited about the direction in which we are heading. We are now positioned to manage the organization more efficiently with our three segments supported by our operational capabilities, strong balance sheet and targeted strategic investments. For example, we now have a more straightforward path to sharpen our focus on the newly created Life Sciences segment and pursue accelerated growth.

本季度，唐納森在我們新的組織結構下運營，旨在更好地服務我們的終端市場客戶，我對我們前進的方向充滿信心和興奮。我們現在可以通過我們的三個部門在我們的運營能力、強大的資產負債表和有針對性的戰略投資的支持下更有效地管理組織。例如，我們現在有一條更直接的途徑來加強對新創建的生命科學領域的關注並追求加速增長。

In February, we added to our Life Sciences portfolio by acquiring Isolere Bio, an early-stage biotechnology company for approximately $63 million. Based in Durham, North Carolina, Isolere develops novel and proprietary reagents and accompanying filtration processes used for the purification and streamlined manufacturing of bio-pharmaceuticals. This technology is designed to substantially improve product quality and purity with faster time lines compared to competing solutions, enabling accelerated and more affordable delivery of life-changing therapies to patients globally.

2 月，我們以約 6300 萬美元的價格收購了早期生物技術公司 Isolere Bio，從而增加了我們的生命科學產品組合。 Isolere 總部位於北卡羅來納州達勒姆，開髮用於生物製藥純化和簡化製造的新型專有試劑和相關過濾工藝。與競爭解決方案相比，該技術旨在以更快的時間線顯著提高產品質量和純度，從而能夠以更快、更實惠的方式向全球患者提供改變生命的療法。

One of the most compelling components of this acquisition is the ability for Donaldson through our portfolio of offerings, including those from Solaris and Purilogics to provide customers a full suite of products, which can be integrated into the downstream bio-manufacturing process. This highlights the string of pearls approach we have taken to grow the Life Sciences segment.

此次收購最引人注目的組成部分之一是唐納森能夠通過我們的產品組合（包括來自 Solaris 和 Purilogics 的產品組合）為客戶提供全套產品，這些產品可以集成到下游生物製造過程中。這凸顯了我們為發展生命科學部門而採取的一系列珍珠方法。

As we execute our go-to-market strategy for these combined solutions, we are building a biopharma-focused sales force to capitalize on the opportunities ahead. I'll talk more about Donaldson's path forward a little later, but first, we'll cover second quarter highlights.

當我們為這些組合解決方案執行我們的上市戰略時，我們正在建立一支以生物製藥為重點的銷售隊伍，以利用未來的機會。稍後我會詳細討論唐納森的前進道路，但首先，我們將介紹第二季度的亮點。

Sales were up 3% year-over-year, driven by pricing of 10% and offset by a currency translation headwind of approximately 4%. Volume decreased slightly this quarter primarily due to the softness in our Aftermarket and Disk Drive businesses. Adjusted EPS of $0.75 was up 32% versus the second quarter of fiscal 2022. We continue to see top line and margin benefits from our pricing actions and while input costs undoubtedly remain elevated, many are slowly coming off peak levels.

銷售額同比增長 3%，受 10% 的定價推動，並被約 4% 的貨幣換算逆風所抵消。本季度銷量略有下降，主要是由於我們的售後市場和磁盤驅動器業務疲軟。調整後的每股收益為 0.75 美元，比 2022 財年第二季度增長了 32%。我們繼續從我們的定價行動中看到收入和利潤率的好處，雖然投入成本無疑仍然很高，但許多正在慢慢脫離峰值水平。

Overall, end market demand remains solid and with improvements in global supply chain conditions, this quarter, we improved our fill rates, reduced our backlog and are returning to more normalized on-time delivery rates.

總體而言，終端市場需求依然強勁，隨著全球供應鏈狀況的改善，本季度我們提高了供貨率，減少了積壓訂單，並恢復到更正常的準時交貨率。

Each quarter, while we focus on near-term execution, we also thoughtfully plant seeds for future profitable growth through our investments, including those in M&A and R&D. I'm pleased with the pieces of the Life Sciences business we have put together and with the integration progress we are making with Solaris and Purilogics. However, we still have a long way to go in building this business and are actively pursuing other opportunities, both organic and inorganic in this space.

每個季度，在我們專注於近期執行的同時，我們還通過我們的投資（包括併購和研發方面的投資）為未來的盈利增長精心播下種子。我對我們整合的生命科學業務的各個部分以及我們與 Solaris 和 Purilogics 的整合進展感到滿意。然而，我們在建立這項業務方面還有很長的路要走，並且正在積極尋求該領域的其他有機和無機機會。

We are also investing in other higher-margin areas such as services. For example, within the Industrial Solutions segment this quarter, we added on to our service offering through the rollout of managed filtration services. Through this offering, Donaldson provides complete and customizable service plans for industrial filtration equipment. These range from condition-based maintenance plans that leverage our proprietary IQ technology to traditional time-based maintenance and repair services needed to keep critical industrial equipment and compliance and online.

我們還投資於服務等其他利潤率較高的領域。例如，在本季度的工業解決方案領域，我們通過推出託管過濾服務增加了我們的服務產品。通過此產品，唐納森為工業過濾設備提供完整且可定制的服務計劃。這些範圍從利用我們專有的 IQ 技術的基於狀態的維護計劃到保持關鍵工業設備和合規性和在線所需的傳統的基於時間的維護和維修服務。

From a capital expenditure standpoint, our investments are also heavily weighted towards growth with capacity expansion, particularly in North America, accounting for the largest portion. To summarize, we are encouraged by the ongoing improvements we are seeing from an operational standpoint and excited about the groundwork we are laying for Donaldson's future.

從資本支出的角度來看，我們的投資也偏重於產能擴張帶來的增長，尤其是在北美，佔比最大。總而言之，我們對從運營角度看到的持續改進感到鼓舞，並對我們為唐納森的未來奠定的基礎感到興奮。

Now I'll provide some detail on second quarter sales. Total company sales were $828 million, up 3% compared with 2022. In Mobile Solutions, total sales were $522 million, up about 2%. Pricing added 12% and FX was an approximate 4% headwind. Sales in Off-Road of $106 million were up 16%. Elevated equipment production levels and strength in our Exhaust and Emissions business in Europe drove sales. On-Road sales were $35 million, a 4% increase from prior year benefiting from strong medium- and heavy-duty truck production. Excluding currency, sales in both of our first-fit businesses were up in all regions.

現在我將提供有關第二季度銷售的一些細節。公司總銷售額為 8.28 億美元，與 2022 年相比增長 3%。在移動解決方案領域，總銷售額為 5.22 億美元，增長約 2%。定價上漲 12%，而外匯逆風上漲約 4%。越野車銷售額為 1.06 億美元，增長 16%。我們在歐洲的排氣和排放業務的設備生產水平和實力的提高推動了銷售。公路銷售額為 3500 萬美元，比上年增長 4%，這得益於強勁的中型和重型卡車生產。不包括貨幣在內，我們兩家首批業務的銷售額在所有地區都有所增長。

Mobile Solutions aftermarket sales were $382 million, down approximately 2% versus prior year. Excluding currency, sales were up roughly 2% as pricing was partially offset by customer inventory reductions in both the OE and independent channels. Not surprising, the improvement in global supply chain conditions has a lot of return to more normalized channel inventory levels.

移動解決方案售後市場銷售額為 3.82 億美元，比上年下降約 2%。不計貨幣因素，銷售額增長了約 2%，因為定價部分被 OE 和獨立渠道的客戶庫存減少所抵消。毫不奇怪，全球供應鏈狀況的改善使渠道庫存水平恢復到更正常的水平。

Lastly, for Mobile Solutions, I would be remiss if I did not talk about China. Broad-based market pressures, negative impacts from the end of zero COVID and the timing of Chinese New Year, which fell in January this year versus February last year, all weighed heavily on second quarter China results. Sales declined 30% year-over-year and 25% in constant currency. The environment in China has certainly been challenging. However, given the sheer market size and our differentiated technology and high-quality offerings, we continue to view China as a long-term growth opportunity.

最後，對於移動解決方案，如果我不談論中國，那就是我的失職。廣泛的市場壓力、零 COVID 結束的負面影響以及今年 1 月與去年 2 月相比的農曆新年時間，都對第二季度中國業績產生了沉重壓力。銷售額同比下降 30%，按固定匯率計算下降 25%。中國的環境當然充滿挑戰。然而，鑑於龐大的市場規模以及我們差異化的技術和高質量的產品，我們繼續將中國視為一個長期增長機會。

Now I'll turn to the Industrial Solutions segment. Industrial sales increased 13% to $246 million. Pricing added 6%, and FX was a 4% headwind. Industrial Filtration Solutions, or IFS, grew 11% to $212 million, driven by dust collection new equipment and replacement part sales and power generation project timing. Aerospace and Defense sales, which now fall within the Industrial segment, continued to benefit from the recovering commercial aerospace industry and were up 28% versus prior year.

現在我將轉向工業解決方案部分。工業銷售額增長 13% 至 2.46 億美元。定價增加了 6%，而外匯是 4% 的逆風。工業過濾解決方案 (IFS) 增長 11%，達到 2.12 億美元，這主要受除塵新設備和更換零件銷售以及發電項目時間安排的推動。現在屬於工業領域的航空航天和國防銷售額繼續受益於商業航空航天業的複蘇，與去年同期相比增長了 28%。

Now on the Life Sciences segment. Life Sciences sales were $59 million, down 16% as continued Disk Drive market weakness weighed heavily on segment sales. Excluding Disk Drive, Life Sciences sales would have increased approximately 7%. We are seeing encouraging sales trends in food and beverage and bioprocessing equipment. These remain key strategic growth areas for Donaldson and we look forward to providing updates on our progress in the future.

現在在生命科學領域。生命科學銷售額為 5900 萬美元，下降 16%，因為磁盤驅動器市場的持續疲軟嚴重影響了該部門的銷售額。不包括磁盤驅動器，生命科學的銷售額將增長約 7%。我們看到食品和飲料以及生物加工設備的銷售趨勢令人鼓舞。這些仍然是唐納森的關鍵戰略增長領域，我們期待在未來提供最新進展。

Overall, our first half of 2023 results were robust, and I'm confident we will continue to deliver on our financial and strategic commitments, for the balance of the year. As such, we are tightening our full year EPS guidance range to the high end of our previous range to reflect our conviction. We are proud of our performance and remain on pace to achieve another year of record sales, record earnings and multi-decade high operating margins.

總體而言，我們 2023 年上半年的業績表現強勁，我相信我們將在今年餘下時間繼續履行我們的財務和戰略承諾。因此，我們將全年每股收益指導範圍收緊至之前範圍的高端，以反映我們的信念。我們為我們的業績感到自豪，並繼續保持步伐，以實現又一年的創紀錄銷售額、創紀錄的收益和數十年的高營業利潤率。

Now I'll turn it over to Scott for more details on the financials and a more detailed update on our outlook for fiscal '23. Scott?

現在，我將把它交給斯科特，以了解有關財務狀況的更多詳細信息以及我們對 23 財年前景的更詳細更新。斯科特？

Thanks, Tod. Good morning, everyone. Our results this quarter were solid. In our view, this is a reflection of how well our employees around the globe maintain their focus on delivering to our customers while working through the completion of the organizational redesign. This redesign was certainly a heavy lift for the company, but I truly believe we are now better positioned than ever for future profitable growth, and I thank our teams for their contributions in this regard.

謝謝，托德。大家，早安。我們本季度的業績穩健。在我們看來，這反映了我們在全球的員工在完成組織重新設計的過程中如何保持專注於為客戶提供服務。這種重新設計對公司來說無疑是一個沉重的提升，但我真的相信我們現在比以往任何時候都更有能力實現未來的盈利增長，我感謝我們的團隊在這方面所做的貢獻。

I will provide color on our outlook for the balance of the year in a few minutes, but first, I will give more details on second quarter results. To summarize the quarter, sales grew 3%, operating income was up 31% and adjusted EPS of $0.75 increased 32% year-over-year. Gross margin of 34.5% improved 340 basis points versus 2022. It was worth noting that gross margin in the second quarter of fiscal 2022 was 31.1%, a very low level for the company as the timing of our pricing actions lagged historic levels of inflation. Pricing now, of course, plays a significant role in our year-over-year improvement as to the stabilization of input costs.

我將在幾分鐘內提供我們對今年剩餘時間的展望，但首先，我將提供有關第二季度業績的更多細節。總結本季度，銷售額增長 3%，營業收入增長 31%，調整後每股收益 0.75 美元，同比增長 32%。 34.5% 的毛利率比 2022 年提高了 340 個基點。值得注意的是，2022 財年第二季度的毛利率為 31.1%，這對公司來說是一個非常低的水平，因為我們的定價行動的時機落後於歷史通脹水平。當然，現在定價在我們在穩定投入成本方面的逐年改善中發揮著重要作用。

From a sequential standpoint, gross margin did not follow our typical seasonal pattern and increased 60 basis points due mainly to inventory valuation. As a result, for the third quarter, we are forecasting gross margin to step down sequentially. However, we still anticipate a year-over-year improvement.

從連續的角度來看，毛利率沒有遵循我們典型的季節性模式，主要由於庫存估值增加了 60 個基點。因此，對於第三季度，我們預測毛利率將連續下降。但是，我們仍然預計會出現同比改善。

Operating expenses as a percent of sales were 19.3%, slightly above 19.2% a year ago. The slight increase was due in large part to the comparison of the prior year as we were still in the early days of a pandemic-related recovery. Operating margin was 15.2%, up 330 basis points versus prior year resulting from gross margin expansion. Operating margin was up 20 basis sequentially. Again, this does not follow our typical seasonal pattern. Further, given our third quarter gross margin expectations, we also anticipate a corresponding step-down in sequential operating margin in the third quarter but a year-over-year improvement.

營業費用佔銷售額的百分比為 19.3%，略高於一年前的 19.2%。小幅增長在很大程度上是由於與前一年相比，因為我們仍處於與大流行相關的複甦的初期。由於毛利率擴張，營業利潤率為 15.2%，較上年增長 330 個基點。營業利潤率環比上升 20 個基點。同樣，這不符合我們典型的季節性模式。此外，鑑於我們對第三季度毛利率的預期，我們還預計第三季度的連續營業利潤率將相應下降，但同比有所改善。

Now I'll touch on segment profitability. Mobile Solutions' pretax profit margin was 15%, up 360 basis points year-over-year and Industrial Solutions' pretax margin was 18.8%, up 640 basis points from prior year. Gross margin expansion, along with operating expense leverage were the drivers in both segments. On the Life Science side, pretax profit margin was 10.6%, down notably from 23.7% a year ago. The decline in Disk Drive sales was the largest driver combined with increased operating expenses as we continue to invest heavily in this segment. Excluding acquisitions, pretax profit margin would have been 16.4%.

現在我將談談細分市場的盈利能力。移動解決方案的稅前利潤率為 15%，同比增長 360 個基點，工業解決方案的稅前利潤率為 18.8%，同比增長 640 個基點。毛利率擴張以及運營費用槓桿是這兩個領域的驅動因素。在生命科學方面，稅前利潤率為 10.6%，明顯低於一年前的 23.7%。磁盤驅動器銷售額的下降是最大的驅動因素，加上我們繼續大力投資這一領域，運營費用增加。不包括收購，稅前利潤率為 16.4%。

Turning to a few balance sheet and cash flow statement highlights. Second quarter capital expenditures were roughly $30 million, mainly driven by capacity expansion investments in North America. Cash conversion in the quarter was 78% versus about 30% in 2022. This improvement reflects a return to more normal levels of conversion following the negative inventory-related working capital impacts in the prior year.

轉向一些資產負債表和現金流量表亮點。第二季度資本支出約為 3000 萬美元，主要受北美產能擴張投資的推動。本季度的現金轉換率為 78%，而 2022 年為 30% 左右。這一改善反映了在去年與庫存相關的營運資本受到負面影響後，轉換率恢復到更正常的水平。

In terms of capital deployment, we returned $98 million to shareholders with $28 million in the form of dividends and $70 million in share repurchases. Our balance sheet is in great shape as we ended the quarter with a net debt-to-EBITDA ratio of 0.8x.

在資本配置方面，我們向股東返還了 9800 萬美元，其中 2800 萬美元以股息的形式和 7000 萬美元的股票回購形式。我們的資產負債表狀況良好，本季度末淨債務與 EBITDA 之比為 0.8 倍。

Now moving to our updated fiscal '23 outlook. For sales, given the new segmentation, I won't go through the exercise of bridging back to our previous guidance for each segment. That said, at a high level, our outlook for total company sales and legacy Engine and Industrial segments has not materially changed. We expect fiscal 2023 sales to increase between 2% and 6%, above our previous guidance of between 1% and 5%. This includes a negative impact from currency translation of about 4%, which is an improvement of 100 basis points from what we expected last quarter. Pricing should contribute about 6% to sales. As a reminder, second half year-over-year sales growth will be lower than first half as incremental pricing benefits begin to fade.

現在轉到我們更新的 23 財年展望。對於銷售，鑑於新的細分，我不會通過橋接回到我們之前對每個細分市場的指導。也就是說，從總體上看，我們對公司總銷售額以及傳統發動機和工業部門的前景沒有發生重大變化。我們預計 2023 財年的銷售額將增長 2% 至 6%，高於我們之前 1% 至 5% 的預期。這包括約 4% 的貨幣換算帶來的負面影響，這比我們上季度的預期提高了 100 個基點。定價應佔銷售額的 6% 左右。提醒一下，隨著增量定價優勢開始消退，下半年的銷售同比增長將低於上半年。

For Mobile Solutions, we are forecasting a revenue increase of between 1% and 5%. Given recent trends, the composition of mobile sales is now expected to be different from our initial projections as stronger-than-expected end market demand for our first-fit products, mainly Off-Road, is forecast to offset weaker-than-expected aftermarket sales. On-Road and Off-Road sales are expected to be up mid-single digits and high single digits, respectively.

對於移動解決方案，我們預計收入將增長 1% 至 5%。鑑於最近的趨勢，現在預計移動銷售的構成將與我們最初的預測不同，因為終端市場對我們的首次適配產品（主要是越野車）的需求強於預期，預計將抵消弱於預期的售後市場銷售量。公路和越野銷量預計將分別增長中個位數和高個位數。

Aftermarket sales are projected to be up low single digits. As Tod mentioned, customer inventory reductions are a response to improved supply chain conditions are impacting sales in both aftermarket channels.

售後市場銷售額預計將達到低個位數。正如 Tod 所提到的，客戶庫存減少是對供應鏈狀況改善的回應，正在影響兩個售後市場渠道的銷售。

In the Industrial Solutions segment, we expect sales growth of between 8% and 12%, driven by continued strength in IFS, dust collection, new and replacement parts, in particular, and Aerospace and Defense. IFS are forecasted to increase high single digits, and Aerospace and Defense sales are projected to grow low double digits.

在工業解決方案領域，我們預計銷售額將增長 8% 至 12%，這主要得益於 IFS、除塵、新零件和替換零件，尤其是航空航天和國防領域的持續增長。 IFS 預計將增長高個位數，而航空航天和國防銷售額預計將增長低兩位數。

For the Life Sciences segment, we are forecasting a sales decline of between 5% and 9%. Disk Drive sales have been negatively impacting results. However, we do anticipate a stabilization of the sales in the second half of the year. We also expect continued strength in food and beverage and bioprocessing equipment or Solaris sales.

對於生命科學部門，我們預計銷售額將下降 5% 至 9%。磁盤驅動器銷售對結果產生了負面影響。但是，我們確實預計下半年的銷售會趨於穩定。我們還預計食品和飲料以及生物加工設備或 Solaris 銷售將繼續走強。

In terms of operating margin, we are narrowing our guidance to between 14.6% and 15.0%. The midpoint of this range reflects a 130 basis point increase from prior year, primarily driven by gross margin improvement. From an operating expense perspective, while we continued exercise discipline, particularly given the uncertain macro environment, we are committed to building for the future through our reinvestments back into the business. With respect to EPS, we are now expecting results within the range of $2.99 and $3.07 towards the higher end of our previous range of $2.91 and $3.07. The midpoint of our new EPS guidance range represents an approximately 13% increase from a record fiscal 2022.

在營業利潤率方面，我們正在將我們的指導收窄至 14.6% 至 15.0% 之間。這一範圍的中點反映了比上一年增加 130 個基點，這主要是由於毛利率的提高。從運營費用的角度來看，在我們繼續遵守紀律的同時，特別是考慮到不確定的宏觀環境，我們致力於通過對業務的再投資來建設未來。關於每股收益，我們現在預計結果在 2.99 美元和 3.07 美元之間，接近我們之前 2.91 美元和 3.07 美元範圍的較高端。我們新的 EPS 指導範圍的中點比創紀錄的 2022 財年增加了約 13%。

Now on to our balance sheet and cash flow outlook. Cash conversion is forecast in the range of 110% and 120%, higher than our historical averages and in line with our previous guidance. The strong cash conversion from this year is expected to be driven by benefits from improved inventory efficiency as we continue to refine our processes and as supply chain conditions normalize. Our capital expenditures forecast heavily weighted towards growth initiatives is between $115 million and $130 million. This includes investments in capacity expansion along with tooling and equipment for new products and technology. Our remaining capital deployment priorities include additional investments in Donaldson's inorganic growth, specifically in Life Sciences, as evidenced by the Isolere acquisition and services as well as our ongoing commitment to dividends and share repurchases.

現在進入我們的資產負債表和現金流量展望。現金轉換率預計在 110% 和 120% 之間，高於我們的歷史平均水平，符合我們之前的指引。隨著我們繼續改進流程和供應鏈條件正常化，預計今年強勁的現金轉換將受到庫存效率提高帶來的好處的推動。我們對增長計劃的資本支出預測在 1.15 億美元至 1.3 億美元之間。這包括對產能擴張以及新產品和技術的工具和設備的投資。我們剩餘的資本部署優先事項包括對唐納森無機增長的額外投資，特別是在生命科學領域，正如 Isolere 收購和服務以及我們對股息和股票回購的持續承諾所證明的那樣。

Now I'll turn the call back to Tod. Tod?

現在我會把電話轉回給托德。托德？

Thanks, Scott. I would like to express my deep gratitude to our dedicated Donaldson team. Their commitment to our organization and to our customers and their professionalism through the redesign has been truly wonderful. I'm excited about our path forward.

謝謝，斯科特。我想對我們敬業的唐納森團隊表示深深的感謝。他們通過重新設計對我們的組織和客戶的承諾以及他們的專業精神真的很棒。我對我們前進的道路感到興奮。

Looking ahead, Donaldson's goal is to remain the leader in technology-led filtration and to support our people, our customers and our communities in advancing filtration for a cleaner world.

展望未來，唐納森的目標是繼續保持以技術為主導的過濾領域的領先地位，並支持我們的員工、我們的客戶和我們的社區推進過濾技術，打造一個更清潔的世界。

First, on supporting our people. Building on our strong technological foundation, our engineers, for example, are hard at work every day growing our innovation engine. They're supported by our commitment to R&D and are developing products and services in our higher margin, higher growth areas.

首先，支持我們的人民。例如，在我們強大的技術基礎之上，我們的工程師每天都在努力工作，以發展我們的創新引擎。他們得到我們對研發的承諾的支持，並正在我們更高利潤、更高增長的領域開發產品和服務。

Second, supporting our customers. As a corporation, we have our own sustainability goals. However, and not to be understated, our products and solutions are inherently well suited to support our customers as they work to achieve their sustainability goals.

第二，支持我們的客戶。作為一家公司，我們有自己的可持續發展目標。然而，不可低估的是，我們的產品和解決方案本質上非常適合支持我們的客戶努力實現其可持續發展目標。

And last, but not least, supporting our communities. Being able to leverage our filtration and separation technologies into different verticals is one of the key competitive advantages of Donaldson. Through our expansion into life sciences, we have now begun to play an increasingly important role in supporting the improvement of global human health.

最後但同樣重要的是，支持我們的社區。能夠將我們的過濾和分離技術應用於不同的垂直領域是唐納森的主要競爭優勢之一。通過我們向生命科學領域的擴張，我們現在開始在支持改善全球人類健康方面發揮越來越重要的作用。

In closing, we are incredibly optimistic as we look out over the long term. We look forward to providing additional color on Donaldson's long-term strategy, growth drivers and key initiatives, including those related to innovation and ESG at our upcoming Investors Day on April 4. At that time, we will also share our longer-term financial objectives.

最後，從長遠來看，我們非常樂觀。我們期待在即將到來的 4 月 4 日投資者日為唐納森的長期戰略、增長動力和關鍵舉措提供更多色彩，包括與創新和 ESG 相關的舉措。屆時，我們還將分享我們的長期財務目標.

Now I'll turn the call back to the operator to open the line for questions.

現在，我會將電話轉回給接線員，以便打開問題熱線。

(Operator Instructions) Your first question today comes from the line of Bryan Blair of Oppenheimer.

（操作員說明）您今天的第一個問題來自 Oppenheimer 的 Bryan Blair。

Another very solid quarter. And I guess as we think about the back half, your -- I suppose someone was a victim of your own success given the stacked comps that you face. I apologize if I missed this and the bread crumbs you did in the outlook. But how should we think about Q3, Q4 cadence top line and EPS? Is it I guess, at a high level, think of moderate growth in Q3, moderate decline in Q4? Or is there more nuance to that?

另一個非常穩固的季度。我想當我們考慮後半部分時，你的 - 我想有人是你自己成功的受害者，因為你面對的是堆積如山的組合。如果我錯過了這個和你在 outlook 中做的麵包屑，我深表歉意。但是我們應該如何考慮第三季度、第四季度的節奏頂線和每股收益？我猜，在高水平上，認為第三季度適度增長，第四季度適度下降？還是有更多細微差別？

This is Scott. Nice to talk to you. So, we held our guidance for the year relatively flat, excluding FX, which had improved for us by 100 basis points. So that was the largest change in the guidance that impacted our back half of the year.

這是斯科特。很高興和你聊天。因此，我們保持今年的指導相對持平，不包括外匯，這為我們帶來了 100 個基點的改善。因此，這是影響我們今年下半年的最大指導變化。

It is kind of interesting this year when we look at our revenue cadence. If you look at last year, we had a strong ramp throughout the year, starting with first quarter revenues of $761 million and ending the year at $890 million. So a strong and steady ramp throughout the year to get to $3.3 billion.

當我們查看我們的收入節奏時，今年有點有趣。如果你看看去年，我們全年的增長勢頭強勁，第一季度收入為 7.61 億美元，年底為 8.9 億美元。因此，全年強勁而穩定的增長達到 33 億美元。

This year, we said we were going to return to more normal level of seasonality, and for Donaldson, that's traditionally been 49, 51 or 48, 52. And so our revenues are much flatter throughout the year with a little bit of a tilt to the second half, just like we normally have historically to get to the $3.4 billion.

今年，我們說我們將恢復到更正常的季節性水平，對於唐納森來說，傳統上是 49、51 或 48、52。下半年，就像我們通常在歷史上達到 34 億美元一樣。

So we're not going to give quarterly guidance, but our revenues in the back half of the year are relatively consistent. And you get a big percentage swings when you compare year-over-year because of the strong ramp from the prior year.

所以我們不會給出季度指導，但我們下半年的收入相對穩定。由於前一年的強勁增長，當你與去年同期相比時，你會得到很大的百分比波動。

In terms of profit, we talked a little bit about gross margins and operating margins. And we're a little bit unseasonal, I would say, this year. And to the future gross margin questions that we're going to get, there's really a lot going on in terms of FX, in terms of inflation, in terms of accounting variances and you have some stuff moving from quarter-to-quarter to make sure you're matching your variances with the inventory.

在利潤方面，我們談了一點毛利率和營業利潤率。我想說，今年我們有點不合時宜。對於我們將要得到的未來毛利率問題，在外匯、通貨膨脹、會計差異方面確實發生了很多事情，而且你有一些東西從一個季度到另一個季度需要調整確保您將差異與庫存相匹配。

And when you look at our margins, you really have to look at the first, second and third quarters and put them together because you got some stuff moving around and you got a lot of volatility in the income statement. And we would hope as we move to the future, that inflation stabilizes, currency stabilizes and we get some more accounting stabilization in our income statement, and that will make our gross margins a little more easy to understand.

當你查看我們的利潤率時，你真的必須查看第一、第二和第三季度並將它們放在一起，因為你有一些東西在移動，損益表中有很大的波動。我們希望隨著我們走向未來，通貨膨脹穩定，貨幣穩定，我們的損益表中的會計更加穩定，這將使我們的毛利率更容易理解。

But if you put the quarters together, you can see strong gross margin improvement, and we're just trying to manage third quarter versus second quarter, and that's why we had the comments in the script. So hopefully, that's a few more bread crumbs that help with your puzzle. And hopefully, that helps with your question.

但如果你把這些季度放在一起，你會看到毛利率有強勁的提高，我們只是在努力管理第三季度與第二季度的對比，這就是我們在腳本中發表評論的原因。所以希望，這是更多的麵包屑，可以幫助您解決難題。希望這對您的問題有所幫助。

Yes, absolutely. I appreciate the detail. And in terms of Life Sciences' Q2 profit decline, Scott, you said that the impact was weighted to the decline in Disk Drive business, which is understandable. It's a meaningful percentage of revenue and it's high margin. Could you specifically parse out what the impact was of Disk Drive declines versus growth investment, either in terms of the EBIT dollar decline or margin contraction?

是的，一點沒錯。我很欣賞細節。就生命科學第二季度的利潤下降而言，斯科特，你說影響被加權到磁盤驅動器業務的下降，這是可以理解的。這是一個有意義的收入百分比，而且利潤率很高。您能否具體分析一下磁盤驅動器下降與增長投資的影響，無論是在息稅前利潤下降還是利潤率收縮方面？

We've not -- Bryan, it's Tod. So we've not really disclosed that level of detail. We will give you more forward-looking at the Investment Day -- at our Investor Day relative to our strategy on a forward look on Life Sciences.

我們還沒有——布萊恩，是托德。所以我們還沒有真正披露那種程度的細節。我們將在投資日為您提供更多前瞻性——在我們的投資者日，與我們對生命科學的前瞻性戰略相關。

Relative to what we're experiencing right now with Disk Drive, the decline has been very acute. It's down between 40% and 50%. And we would look for it to have tough comps for a few more quarters, think about 3. And then we'll have lapped this and then we'll be able to start crawling forward.

相對於我們目前在磁盤驅動器方面所經歷的情況，下降非常嚴重。它下降了 40% 到 50%。我們會希望它在幾個季度內有強硬的表現，想想 3 個。然後我們將完成這個，然後我們將能夠開始向前爬行。

We do believe that it has bottomed. In fact, it looks like it has bottomed in December. But it is also going to bounce at these very low levels for the foreseeable future.

我們確實相信它已經觸底。事實上，它看起來已經在 12 月觸底。但在可預見的未來，它也將在這些非常低的水平上反彈。

Okay. Understood. And you mentioned at Investor Day, looking forward to that next month, and I imagine we'll hear quite a bit more on this front at Investor Day. It would be great to hear a little more color on how Isolere furthers the string of pearls M&A build-out of your Life Sciences platform and how Solaris, Purilogics, Isolere piece together in terms of the platform capabilities and what that signals in terms of your path forward.

好的。明白了。你在投資者日提到，期待下個月，我想我們會在投資者日聽到更多關於這方面的信息。很高興聽到更多關於 Isolere 如何進一步推進生命科學平台的珍珠鍊併購構建以及 Solaris、Purilogics、Isolere 如何在平台功能方面拼湊在一起的顏色，以及這對你的信號意味著什麼前進的道路。

Absolutely. We'll give you that complete story on April 4.

絕對地。我們將在 4 月 4 日為您提供完整的故事。

Your next question comes from the line of Laurence Alexander with Jefferies.

你的下一個問題來自 Jefferies 的 Laurence Alexander。

It's Dan Rizzo on for Laurence. You mentioned that China obviously was down given the COVID and the new year. But as we've exited that, are you seeing order trends pick up? Or is it something you're anticipating in the future?

丹·里佐替勞倫斯上場。你提到，鑑於 COVID 和新年，中國顯然處於低迷狀態。但是當我們退出時，您是否看到訂單趨勢回升？還是您對未來的期待？

It would be more future looking. We're still feeling the pressures across China. We delivered this quarter even with the tough China story still present. And so for us, the more positive outlook to China still lies ahead.

這將更具未來感。我們仍然感受到來自中國各地的壓力。即使在艱難的中國故事仍然存在的情況下，我們也交付了本季度。因此，對我們而言，中國的前景更為樂觀。

Okay. And then with the strength in A&D, are we now back above pre-COVID levels in terms of demand?

好的。然後憑藉 A&D 的實力，我們現在在需求方面是否回到了 COVID 之前的水平之上？

No. We're still more modest in that business. Performing well, but certainly more modest.

不，我們在這方面還是比較謙虛的。表現不錯，但肯定更謙虛。

Okay. And then final question. if we hit into a U.S. recession, I guess, towards -- in the next few months, I mean, could you still easily -- or not easily, but could you still hit the low end of your outlook based upon what we see now?

好的。然後是最後一個問題。如果我們陷入美國經濟衰退，我想，在接下來的幾個月裡，我的意思是，你是否仍然容易 - 或者不容易，但根據我們現在看到的情況，你是否仍然會達到你的前景的低端？

Well, we think so, just simply because -- that's why we give the range, and we have factored in everything we believe we know everything we're seeing on the incoming of the business. We baked in our backlog understandings, et cetera. So we believe that the guidance that we've really given today really takes those scenarios into account.

好吧，我們這麼認為，只是因為 - 這就是我們給出範圍的原因，並且我們已經考慮了我們認為我們知道我們在業務傳入時看到的一切。我們融入了對積壓工作的理解，等等。所以我們相信，我們今天真正給出的指導確實考慮到了這些情況。

Clearly, the only headwind that we would see is if it would be a much more severe recession than anyone is currently considering, but we've baked into the guidance, everything that we believe we know. And as was indicated by the answer earlier, our second half is a bit more modest at this point with our outlook. So we believe we've taken a very balanced approach and a prudent approach to create this guide.

顯然，我們會看到的唯一不利因素是它是否會比任何人目前考慮的嚴重得多，但我們已經將我們認為我們知道的一切都納入了指導方針。正如之前的回答所表明的那樣，我們的下半年在這一點上對我們的前景更為溫和。因此，我們相信我們已經採取了一種非常平衡的方法和一種謹慎的方法來創建本指南。

Your next question comes from the line of Rob Mason with Baird.

你的下一個問題來自 Rob Mason 與 Baird 的對話。

Tod, you made the comment that your overall sales outlook had not really changed, but clearly, the composition within mobile has changed a bit with first-fit being stronger and Aftermarket having slowed a little bit. The destocking impact, I know you had noted isolated incidents of that last quarter in the OED channel. And just you speak to where you think that is, how -- when it began? How long it may take to run its course? And how independent in the OED channels actually performed in the quarter, if you could?

Tod，你評論說你的整體銷售前景並沒有真正改變，但很明顯，手機的構成發生了一些變化，首次適配更強，售後市場放緩了一點。去庫存的影響，我知道你已經註意到 OED 頻道上個季度的孤立事件。只是你說的是你認為的地方，它是如何——什麼時候開始的？運行它的過程可能需要多長時間？如果可以的話，本季度 OED 頻道的實際表現如何？

Yes. Sure, Rob. So when you look at where we're at with destocking, it's clear that it was a bit more than we would have expected at this point. However, I would tell you, the OE channel was more severe than the independent channel. And the independent channel acted about as we would have expected.

是的。當然，羅伯。因此，當您查看我們在去庫存方面所處的位置時，很明顯這比我們此時的預期要多一些。但是，我會告訴你，OE 渠道比獨立渠道更嚴格。獨立頻道的表現與我們預期的一樣。

We have had a number of people out at across our distributors. We feel as though we're at pull-through levels there. And so, while it could step down a little bit more, we've taken that into account within the guide. We're pretty comfortable on the independent channel.

我們的經銷商中有很多人。我們感覺好像我們在那里處於拉動水平。因此，雖然它可能會降低一點，但我們已經在指南中考慮到了這一點。我們對獨立頻道非常滿意。

The one that actually went a little bit further this quarter than we would have expected is the OE channel. They pulled their inventories down a bit more than we would have expected. Perhaps we should have seen that, knowing that they were the most aggressive relative to the inventory buildup last year when they couldn't get parts. But that's the net result.

本季度實際比我們預期走得更遠的是 OE 渠道。他們降低庫存的幅度比我們預期的要多一些。或許我們應該看到這一點，因為他們知道與去年無法獲得零件的庫存積累相比，他們是最激進的。但這就是最終結果。

So net-net, it's just a little bit more than we would have expected. Nothing to suggest, hey, there's a line here to be interpreted into something, and we're pretty comfortable with where we are.

所以淨淨，它比我們預期的要多一點。沒什麼好建議的，嘿，這裡有一條線可以解釋成某種東西，我們對自己的位置很滿意。

Does -- there was also a mention of some of the restructuring charges assigned to customer program exits. And again, we've -- you've called those out already earlier this year your choice to move away from some business. Was this incremental? Or is this just catching up to the actions you've already called out, the cost restructuring that is?

確實 - 還提到了分配給客戶計劃退出的一些重組費用。再一次，我們已經 - 你已經在今年早些時候宣布了你選擇離開某些業務的選擇。這是增量的嗎？或者這只是趕上你已經呼籲採取的行動，即成本重組？

I mean these are some actions we took during the quarter. So we're continuously focused on managing our pricing and managing our margins, and we want to have reasonable commercial relationships with our customers. And you remember, we had one particular program we talked about last year. This is another program that we focused on and work with our customer to work ourselves out of this particular program. And I think it's a good move for the company. We want to manage the capital required, and we don't want to have hollow revenues. So this is something that we're going to continue to focus on.

我的意思是這些是我們在本季度採取的一些行動。因此，我們一直專注於管理定價和利潤率，我們希望與客戶建立合理的商業關係。你還記得，我們去年討論過一個特別的項目。這是我們關注並與我們的客戶合作以完成該特定程序的另一個程序。我認為這對公司來說是一個很好的舉措。我們想要管理所需的資本，我們不想有空洞的收入。所以這是我們將繼續關注的事情。

This one was a little bit bigger than average, and we did take a charge in the quarter to account for it, but it's something we're focused on. And I think our team is doing a really good job of managing pricing and working ourselves out of situations that we don't think are acceptable to the company.

這個比平均水平大一點，我們確實在本季度收取了費用來解釋它，但這是我們關注的事情。而且我認為我們的團隊在管理定價和解決我們認為公司無法接受的情況方面做得非常好。

I see. I see. If I could slip one more in real quick. Just Scott, maybe just to return to the margin outlook for the second half of the year. And you touched on some of the moving pieces there with inventory valuation gross margin. But just again, at a high level, it looks like margins would step down -- at the midpoint of your guidance, the margins would step down on maybe 5% more volume in the second half versus the first half. How much of the step-down should I think is in the gross margin line versus growth in OpEx -- investments...

我懂了。我懂了。如果我能很快再滑一個。只是斯科特，也許只是為了回到今年下半年的利潤率前景。你談到了一些具有庫存估值毛利率的變動因素。但再一次，在高水平上，利潤率似乎會下降——在你的指導的中點，下半年的利潤率可能會比上半年多 5%。我認為毛利率下降多少與運營支出增長相對應——投資……

Yes, a fair question. I think the OpEx will be relatively stable. That's a lot easier to control as and you spend, you expense. I think it all is related to gross margin. And I apologize for the volatility in our income statement, but I think it's kind of a function of the times that we live in. And our finance team does an excellent job of managing the variances and making sure we properly account for those, and we have to roll those off as the inventory rolls off.

是的，一個公平的問題。我認為 OpEx 會相對穩定。這更容易控制，因為你花錢，你花錢。我認為這一切都與毛利率有關。我為我們的損益表中的波動表示歉意，但我認為這是我們所處時代的一種功能。我們的財務團隊在管理差異方面做得非常出色，並確保我們正確地考慮到這些差異，我們必須隨著庫存的減少而減少這些。

And so, it's a little bit volatile. I think next year, hopefully, it will be a lot smoother in terms of gross margin and easier to understand. But we do have a little bit of volatility in those quarter, especially the sequential quarter comparisons, which challenges everyone's ability to understand it. That's why I say I think you want to try to take a little more of a balanced view and look at the first, second and third quarters together and you'll have a better view of the margin.

因此，它有點不穩定。我認為明年，希望在毛利率方面會更加順暢，更容易理解。但是我們在那個季度確實有一點波動，尤其是連續的季度比較，這挑戰了每個人的理解能力。這就是為什麼我說我認為你想嘗試採取更多的平衡觀點並一起看第一、第二和第三季度，你會對利潤率有更好的看法。

Just to give everybody a feel if you track the margins, going back to Q2 of last year, 31.1%, then a 31.5% and then a 32.9% in Q4 of last year for 32.6% for the full year. And then this year, we did a 33.9% in the first quarter and a 34.5% in the second quarter. So you can see our pricing actions are coming through as we promised, and the costs that we're experiencing with this strong inflation is being capitalized in the inventory and then expensed off.

如果你追踪利潤率，讓每個人都有一個感覺，回到去年第二季度，31.1%，然後是 31.5%，然後是去年第四季度的 32.9%，全年為 32.6%。然後今年，我們在第一季度實現了 33.9%，在第二季度實現了 34.5%。所以你可以看到我們的定價行動正在按照我們的承諾進行，我們在這種強勁的通貨膨脹中所經歷的成本正在庫存中資本化，然後被支出。

And this is kind of the peak of it, we think. Our costs seem to have stabilized, so we're happy about that. And we'll take it forward from there. So hopefully, that gives you a little bit more color for both you and Bryan.

我們認為，這是它的頂峰。我們的成本似乎已經穩定下來，所以我們對此感到高興。我們將從那裡推進它。希望這能為您和 Bryan 帶來更多色彩。

It does. It does.

確實如此。確實如此。

Your next question comes from the line of Nathan Jones with Stifel.

你的下一個問題來自 Nathan Jones 與 Stifel 的對話。

This is [Matt] on for Nathan Jones. I just wanted to talk about Life Sciences. Outside of the Disk Drive business, can you talk about the growth in food and beverage and fire processing and the opportunities there?

這是內森·瓊斯的[馬特]。我只想談談生命科學。在磁盤驅動器業務之外，您能否談談食品和飲料以及消防加工的增長以及那裡的機遇？

Sure. Food and beverage, Matt, grew in the quarter above 20%. And we continue our real positive momentum within the food and beverage initiatives that we have pressing forward. Unfortunately, obviously, the headwind in the Disk Drive has muted that rather significantly.

當然。食品和飲料 Matt 在本季度增長了 20% 以上。我們在我們推動的食品和飲料計劃中繼續我們真正的積極勢頭。不幸的是，很明顯，磁盤驅動器的逆風已經相當明顯地減弱了這一點。

And again, I do want to emphasize that when it comes to the Life Sciences pieces, we'll give, at Investor's Day, a very forward-looking strategic view of how all of the acquisitions that we have made as well as our food and beverage initiatives really contributed to our strategy forward-looking.

再一次，我想強調的是，當涉及到生命科學領域時，我們將在投資者日給出一個非常具有前瞻性的戰略觀點，說明我們進行的所有收購以及我們的食品和飲料舉措確實有助於我們的戰略具有前瞻性。

Okay. And then turning back to kind of Mobile, Aftermarket sales. Is the -- with regards to inventory is the underlying market starting to contract? Do you believe the contraction is all due to more inventory normalization?

好的。然後轉回某種移動、售後市場銷售。關於庫存，基礎市場是否開始收縮？您認為收縮是由於更多的庫存正常化嗎？

It's more balanced. It's more inventory across the overall channel. Ag still holding very good. Construction's holding good. Over-road trucking is good. Mining is good. So I -- it's just more a sign of supply chain really normalizing. And so, people have more confidence, and they're just walking down slightly, inventory management.

它更平衡。這是整個渠道的更多庫存。 Ag 仍然持有很好。施工進展順利。公路卡車運輸很好。挖礦很好。所以我 - 這只是供應鏈真正正常化的標誌。因此，人們更有信心，他們只是略微走下庫存管理。

Your next question comes from the line of Dillon Cumming with Morgan Stanley.

你的下一個問題來自摩根士丹利的 Dillon Cumming。

I apologize for fixating on this a little bit. I just wanted to come back to Life Sciences one more time. Can you just talk through the decision to include Disk Drive in Life Sciences? I think going forward, right, you talked about how Disk Drive is still a sectorally more challenged market relative to the more positive outlook you have process filtration. Was it more about the margin profile? Like what really caused the, I guess, impetus to include Disk Drive in Life Sciences?

我很抱歉有點關注這個。我只是想再回到生命科學領域。您能否談談將磁盤驅動器納入生命科學領域的決定？我認為展望未來，對，你談到磁盤驅動器如何仍然是一個行業更具挑戰性的市場，相對於你對過程過濾的更積極的前景。是否更多地與利潤率有關？我猜是什麼真正導致了將磁盤驅動器納入生命科學領域的動力？

Disk Drive belongs into the life sciences sector because the technologies of membranes are all how you -- are all included in that sector and how you -- how those technologies really apply directly into the Life Sciences sector.

磁盤驅動器屬於生命科學領域，因為膜技術就是你如何 - 都包含在那個領域以及你如何 - 這些技術如何真正直接應用於生命科學領域。

So expanded polytetrafluoroethylene, to be able to make membranes, is really critical to the long-term strategy of how we view Life Sciences. And when you look at what we're inventing out of our Disk Drive-based businesses, that has allowed us to go into other medical-based applications, et cetera.

如此膨脹的聚四氟乙烯，能夠製造膜，對於我們如何看待生命科學的長期戰略非常關鍵。當您查看我們從基於磁盤驅動器的業務中發明的東西時，這使我們能夠進入其他基於醫療的應用程序，等等。

So it's really a foundational technology view. And then how that foundation then builds up directly into the end markets, enabling products to be invented on the in-between to solve customer problems. And that's why it really belongs in Life Sciences. It happens to deliver the Disk Drive today, and it's been terrific for us in inventing great membranes that now we can parlay over into our Life Sciences sector, and that's why it's there.

所以這真的是一個基礎技術觀點。然後該基礎如何直接建立到終端市場，使產品能夠在中間發明以解決客戶問題。這就是它真正屬於生命科學的原因。它恰好今天提供了磁盤驅動器，它對我們發明偉大的膜來說非常了不起，現在我們可以將其用於生命科學領域，這就是它存在的原因。

Okay. Yes. That makes a lot of sense. And then if I can just ask on the Industrial Solutions margin expansion in the quarter. I'm just wondering if you can kind of expand on that a bit. I know you called out the inventory valuation kind of gross margin tailwind at the company level. But I'm not sure if that benefit was felt more acutely in Industrial? If there was a more idiosyncratic price/cost benefit? Or what was actually driving the outsized margin expansion there?

好的。是的。這很有意義。然後我是否可以問一下本季度工業解決方案的利潤率擴張。我只是想知道你是否可以稍微擴展一下。我知道你在公司層面上提到了庫存估值類型的毛利率順風。但我不確定這種好處是否在工業中體現得更強烈？如果有更特殊的價格/成本效益？或者是什麼真正推動了利潤率的大幅擴張？

Yes. I mean the Industrial business had a really strong quarter. They had good price and they had good volume. And so they grew pretty significantly 12.8% and 16.7% in local currency. So our Industrial team is hitting their stride and they had strong incremental margins this quarter. And that includes a currency drag.

是的。我的意思是工業業務有一個非常強勁的季度。他們的價格很好，而且銷量很好。因此，以當地貨幣計算，它們分別增長了 12.8% 和 16.7%。因此，我們的工業團隊正在大踏步前進，本季度他們的利潤率增長強勁。這包括貨幣拖累。

So the business performed well, and you were coming off of COVID. So admittedly, we have weaker comps there, and we had a cost issue last year. So the overall margins for the company were pretty weak last year and we're coming off of weak comps and really good performance for the Industrial team this quarter. And so you see that strong operating margin growth. And so we're really pleased and grateful for their performance.

因此，業務表現良好，您正在擺脫 COVID。所以不可否認，我們在那裡的競爭較弱，去年我們遇到了成本問題。因此，去年公司的整體利潤率非常低，本季度我們正在擺脫疲軟的競爭，而工業團隊的表現非常好。所以你會看到強勁的營業利潤率增長。因此，我們對他們的表現感到非常高興和感激。

There are no further questions at this time. I turn the call back over to Tod Carpenter for closing remarks.

目前沒有其他問題。我將電話轉回給 Tod Carpenter 以作結束語。

That concludes today's call. Thanks to everyone who participated, and we look forward to seeing you at our Investor Day, April 4 and reporting our third quarter results in late May. Have a great rest of the day. Goodbye.

今天的電話會議到此結束。感謝所有參與的人，我們期待在 4 月 4 日的投資者日見到您，並在 5 月下旬報告我們的第三季度業績。好好休息一天。再見。

This concludes today's call. Thank you for attending. You may now disconnect.

今天的電話會議到此結束。感謝您的出席。您現在可以斷開連接。