Donaldson Company Inc (DCI) 2023 Q3 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, Inc. Third Quarter 2023 Earnings Conference Call. (Operator Instructions) 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，我想歡迎大家參加唐納森公司 2023 年第三季度收益電話會議。 （操作員說明）投資者關係高級總監 Sarika Dhadwal，您可以開始您的會議。

Good morning. Thank you for joining Donaldson's Third 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 third quarter performance and an update on our outlook for fiscal 2023.

早上好。感謝您參加唐納森 2023 財年第三季度收益電話會議。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 將提供我們第三季度業績的總結以及我們對 2023 財年展望的更新。

During today's call, we will discuss non-GAAP or adjusted results. A reconciliation of GAAP to non-GAAP metrics is provided within the schedules attached to this morning's press release. 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.

在今天的電話會議中，我們將討論非 GAAP 或調整後的結果。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。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. Third quarter was another record quarter for Donaldson Company. We continued the trends seen in the first half of this fiscal year. Compared with prior year, we grew our top line to a quarterly record, expanded both gross and operating margins over 100 basis points, delivered double-digit earnings growth and produced cash conversion of approximately 105%.

謝謝，薩里卡。早上好。第三季度是唐納森公司又一個創紀錄的季度。我們延續了本財年上半年的趨勢。與上一年相比，我們的收入增長到季度記錄，毛利率和營業利潤率均提高了 100 個基點以上，實現了兩位數的收益增長，並產生了約 105% 的現金轉換率。

Before diving deeper into the quarterly results, I would like to express how pleased we were to have so many of you participate either in person or virtually at our Investors Day in April. It was a big day for our company, and I will recap some key takeaways.

在深入探討季度業績之前，我想表達我們很高興有這麼多人親自或虛擬參加 4 月份的投資者日。這對我們公司來說是重要的一天，我將回顧一些要點。

We demonstrated our leadership position and strategy across all 3 segments that together drives our expectation to achieve sales of approximately $4 billion and operating margins in the 16% range by fiscal 2026.

我們展示了我們在所有 3 個細分市場的領導地位和戰略，這共同推動了我們的預期，即到 2026 財年實現約 40 億美元的銷售額和 16% 的營業利潤率。

More specifically, I would like to highlight our new Life Sciences segment where there are significant compelling opportunities driven by organic and inorganic investments, including the recent acquisitions of Solaris, Purilogics and Isolere Bio. These businesses combined with Donaldson's technologies and expertise provide a portfolio of opportunities across several end markets such as food and beverage, alternative proteins, bioprocessing and medical devices.

更具體地說，我想強調我們新的生命科學領域，在有機和無機投資的推動下，包括最近對 Solaris、Purilogics 和 Isolere Bio 的收購，這些領域存在著巨大的誘人機會。這些業務與唐納森的技術和專業知識相結合，為食品和飲料、替代蛋白質、生物加工和醫療設備等多個終端市場提供了一系列機會。

Focusing in on bioprocessing, for example, we see game-changing opportunities to support the development of vaccine and advanced cell and gene therapies with our newly acquired technologies. Traditional chromatography systems are slow and not optimized for larger molecules such as mRNA and plasmid DNA.

例如，專注於生物加工，我們看到了改變遊戲規則的機會，可以利用我們新獲得的技術來支持疫苗以及先進細胞和基因療法的開發。傳統層析系統速度慢，且未針對 mRNA 和質粒 DNA 等較大分子進行優化。

Purilogics' innovative technology provides faster flow rates and puts less stress on cells and Isolere Bio allows us to introduce breakthrough technology that provides purification and solutions with no size limitations. Together, and combined with Donaldson's capabilities, we are at the cusp of driving scale across vaccine and cell and gene therapies to solve the world's greatest health risks.

Purilogics 的創新技術提供更快的流速並減少對細胞的壓力，而 Isolere Bio 使我們能夠引入突破性技術，提供無尺寸限制的純化和解決方案。與唐納森的能力相結合，我們正處於推動疫苗、細胞和基因療法規模化以解決世界上最大的健康風險的風口浪尖。

To that end, we will continue to grow these businesses by investing organically and pursuing strategic M&A in adjacent areas which will further us on the path of continuing to create value for all of our stakeholders.

為此，我們將繼續通過有機投資和在鄰近地區進行戰略併購來發展這些業務，這將進一步推動我們繼續為所有利益相關者創造價值。

Now some third quarter highlights. Sales were up 3% year-over-year, driven by pricing of 8% and partially offset by a currency translation headwind of approximately 3%. Volume was down in the quarter as our Aftermarket business was negatively impacted from OE customers continuing to reduce inventories as service levels normalize. Also, negatively impacting volumes was our Disk Drive business, which remains muted from market-related weakness.

現在是第三季度的一些亮點。銷售額同比增長 3%，受 8% 的定價推動，部分被約 3% 的貨幣換算逆風所抵消。本季度銷量下降，因為我們的售後市場業務受到 OE 客戶隨著服務水平正常化而繼續減少庫存的負面影響。此外，對銷量產生負面影響的是我們的磁盤驅動器業務，該業務因市場相關疲軟而保持低迷。

EPS was $0.76, a 14% increase over the prior year. Our strategic pricing implemented to offset elevated input costs continues to be a big driver of our quarterly sales and earnings results. Most input costs have stabilized at higher levels. However, some areas such as labor remain a headwind. Therefore, pricing remains critical in our recovery from this period of sharp year-over-year inflation.

每股收益為 0.76 美元，比上年增長 14%。我們為抵消高昂的投入成本而實施的戰略定價仍然是我們季度銷售和盈利結果的重要推動力。大多數投入成本已穩定在較高水平。然而，勞動力等一些領域仍然是不利因素。因此，定價對於我們從這一同比急劇上漲的時期中復蘇仍然至關重要。

Turning to our operations. I'm pleased by our improvements in fill rates, on-time deliveries and late backlog levels across the organization. We are working to meet the needs of our customers today while investing in capacity projects, including in North America, to meet the needs of our customers in the future.

轉向我們的運營。我很高興我們在整個組織的填充率、準時交付和延遲積壓水平方面有所改善。我們正在努力滿足當今客戶的需求，同時投資包括北美在內的產能項目，以滿足客戶未來的需求。

We are also committed to furthering our long history of innovation to expand our product offerings. For example, this quarter, we released our proprietary Alpha-Web filtration media. This new hydraulic technology improves fluid cleanliness up to 4x and creates additional value for customers by extending critical component life.

我們還致力於延續我們悠久的創新歷史，以擴大我們的產品供應。例如，本季度，我們發布了專有的 Alpha-Web 過濾介質。這種新的液壓技術可將流體清潔度提高 4 倍，並通過延長關鍵部件的使用壽命為客戶創造額外價值。

In addition to our organic investments, we are working through our M&A pipeline and actively pursuing Life Sciences opportunities with a focus on revolutionary technologies and applications such as those we acquired through Solaris, Purilogics and Isolere Bio.

除了我們的有機投資外，我們還在通過併購渠道積極尋求生命科學機會，重點關注革命性技術和應用，例如我們通過 Solaris、Purilogics 和 Isolere Bio 收購的技術和應用。

Now I'll provide some detail on third quarter sales. Total company sales were $876 million, up 3% from prior year. In Mobile Solutions, total sales were $555 million, roughly flat versus a year ago. Pricing added 9% and FX was an approximate 3% headwind.

現在我將提供有關第三季度銷售的一些細節。公司總銷售額為 8.76 億美元，比上年增長 3%。在移動解決方案方面，總銷售額為 5.55 億美元，與一年前大致持平。定價上漲 9%，外匯逆風上漲約 3%。

Our First-fit businesses continue to perform well with sales in Off-Road of $116 million, up 11% year-over-year and sales in On-Road of $38 million, up 5%. These results reflect healthy levels of equipment production rates across all our major geographies. Mobile Solution's Aftermarket sales of $401 million were down roughly 3% year-over-year from OE customer inventory drawdowns to more normal levels.

我們的首次適配業務繼續表現良好，越野銷售額為 1.16 億美元，同比增長 11%，公路銷售額為 3800 萬美元，同比增長 5%。這些結果反映了我們所有主要地區的設備生產率處於健康水平。 Mobile Solution 的售後市場銷售額為 4.01 億美元，同比下降約 3%，原因是 OE 客戶庫存減少至更正常的水平。

Lastly, for Mobile Solutions, an update on China. Sales increased 5% versus 2022 and 14% in constant currency. While this year-over-year growth marks a considerable improvement from what we reported in the second quarter, the one thing to note is that last year's third quarter sales were depressed from COVID-19 lockdowns.

最後，對於移動解決方案，更新了中國的情況。與 2022 年相比，銷售額增長了 5%，按固定匯率計算增長了 14%。雖然今年的同比增長標誌著我們在第二季度報告的情況有了相當大的改善，但需要注意的一件事是，去年第三季度的銷售額因 COVID-19 封鎖而受到抑制。

Overall, China continues to be challenging given the weaker end market conditions. That said, sheer market size, combined with our world-class technology and high-quality offerings should result in Donaldson's success in the Chinese market over the long term.

總體而言，鑑於疲軟的終端市場狀況，中國市場仍面臨挑戰。也就是說，龐大的市場規模，加上我們世界一流的技術和高質量的產品，應該會促使唐納森在中國市場取得長期成功。

Now I'll turn to the Industrial Solutions segment. Industrial sales grew 14% to $262 million, pricing added 6%, and FX was roughly a 3% headwind. Industrial Filtration Solutions or IFS grew 13% to $223 million driven by dust collection and industrial gases part sales. Aerospace and defense sales were up 22%, supported by the ongoing strength in the Commercial Aerospace industry.

現在我將轉向工業解決方案部分。工業銷售額增長 14% 至 2.62 億美元，定價增長 6%，而外匯大約是 3% 的不利因素。工業過濾解決方案或 IFS 增長了 13%，達到 2.23 億美元，這得益於除塵和工業氣體零件銷售。航空航天和國防銷售額增長了 22%，這得益於商業航空航天業的持續增長。

Now on the Life Sciences segment. Life Sciences sales were $59 million, down 13% year-over-year. Weakness in the overall Disk Drive market continues to drive the majority of the decrease. However, we are now seeing a flattening and forecasting a slow demand recovery during the second half of calendar 2023.

現在在生命科學領域。生命科學銷售額為 5900 萬美元，同比下降 13%。整體磁盤驅動器市場的疲軟繼續推動大部分下降。然而，我們現在看到需求趨於平緩，預計 2023 年下半年需求將緩慢復甦。

Our Food and Beverage business remained solid in the quarter with continued momentum in both new and replacement part sales. We look forward to continuing to provide updates on all of our businesses within this segment in the future.

我們的食品和飲料業務在本季度保持穩健，新零件和替換零件的銷售持續增長。我們期待在未來繼續提供我們在這一領域的所有業務的更新。

As we progress through the final quarter of fiscal 2023, we've been extremely pleased with our ability to deliver strong financial results thus far this year while making strides across our strategic initiatives. As such, we are reaffirming our sales and earnings guidance for the full year by tightening our previously provided outlook ranges and remain confident in achieving our long-term targets laid out at our recent Investors Day.

隨著我們在 2023 財年最後一個季度取得進展，我們對今年迄今為止取得強勁財務業績的能力感到非常滿意，同時在我們的戰略計劃中取得了長足進步。因此，我們通過收緊我們之前提供的前景範圍來重申我們全年的銷售和盈利指導，並對實現我們在最近的投資者日制定的長期目標充滿信心。

Now I'll turn it over to Scott, who will provide more details on the financials and an update on our outlook for fiscal '23. Scott?

現在我將把它交給斯科特，他將提供有關財務的更多詳細信息以及我們對 23 財年前景的最新展望。斯科特？

Thanks, Tod. Good morning, everyone. Third quarter results reflect another solid quarter for Donaldson in which our employees delivered for our customers and planted seeds for future profitable growth, laying the groundwork for achieving our longer-term financial and strategic objectives.

謝謝，托德。大家，早安。第三季度的業績反映了唐納森又一個穩健的季度，我們的員工為我們的客戶提供了服務，並為未來的盈利增長播下了種子，為實現我們的長期財務和戰略目標奠定了基礎。

I thank our employees around the globe for their daily contributions. I will provide color on our outlook for the balance of the year in a few minutes, but first we'll give more details on the results this quarter.

我感謝我們全球各地的員工每天所做的貢獻。我將在幾分鐘內提供我們對今年剩餘時間的展望的顏色，但首先我們將提供有關本季度結果的更多細節。

To summarize, sales grew 3% versus 2022. Operating income was up 12% and EPS of $0.76 increased 14% year-over-year. Gross margin was 33.0%, a 150 basis point improvement versus prior year. Similar to the first half of the year, this quarter we saw benefits from our pricing and the stabilization of input cost inflation.

總而言之，與 2022 年相比，銷售額增長了 3%。營業收入增長了 12%，每股收益為 0.76 美元，同比增長了 14%。毛利率為 33.0%，比上年提高 150 個基點。與今年上半年類似，本季度我們從定價和投入成本通脹的穩定中受益。

Gross margin was down sequentially as expected due to an unseasonably strong second quarter, driven in part by inventory valuation and the timing of deflation. Overall, third quarter gross margin results were consistent with our internal expectations.

由於第二季度異常強勁，部分原因是庫存估值和通貨緊縮的時機，毛利率如預期的那樣連續下降。總體而言，第三季度毛利率結果符合我們的內部預期。

Operating expenses as a percentage of sales were 18.8%, slightly above 18.5% a year ago. The deleveraging of operating expenses in the quarter was due to an increase in Life Sciences, investments and post-COVID hiring. Operating margin was 14.2%, up 120 basis points versus prior year, driven by gross margin improvement. In line with my comments on gross margin, operating margin was down sequentially due to an unseasonably high second quarter.

營業費用佔銷售額的百分比為 18.8%，略高於一年前的 18.5%。本季度運營費用的去槓桿化是由於生命科學、投資和 COVID 後招聘的增加。在毛利率改善的推動下，營業利潤率為 14.2%，較上年增長 120 個基點。與我對毛利率的評論一致，由於第二季度異常高，營業利潤率環比下降。

Now I'll discuss segment profitability. Mobile Solutions' pretax profit margin was 15%, up 70 basis points year-over-year and Industrial Solutions' pretax profit margin was 18.8%, up 390 basis points from the prior year. Gross margin expansion was a key driver in both of these segments.

現在我將討論細分市場的盈利能力。 Mobile Solutions 的稅前利潤率為 15%，同比增長 70 個基點，而 Industrial Solutions 的稅前利潤率為 18.8%，同比增長 390 個基點。毛利率的擴張是這兩個領域的主要驅動力。

On the Life Sciences side, pretax profit margin was 0.3% versus 20.6% a year ago. The decline in Disk Drive sales was the largest driver. However, investment in our pre-revenue acquisitions, including Isolere Bio, also negatively impacted results. We are in the investment phase of these acquisitions and are priming them for future growth. Excluding acquisitions, pretax profit margin would have been better by approximately 800 basis points.

在生命科學方面，稅前利潤率為 0.3%，而一年前為 20.6%。磁盤驅動器銷售額的下降是最大的驅動因素。然而，對我們收入前收購的投資，包括 Isolere Bio，也對結果產生了負面影響。我們正處於這些收購的投資階段，並為未來的增長做好準備。不包括收購，稅前利潤率將提高約 800 個基點。

Turning to a few balance sheet and cash flow statement highlights. Third quarter capital expenditures mainly inclusive of continued capacity expansion investments in North America were approximately $36 million. Cash conversion in the quarter was 105% versus 49% in 2022. We are now experiencing above-average levels of conversion, resulting from inventory related working capital benefits from the easing of supply chain constraints.

轉向一些資產負債表和現金流量表亮點。第三季度主要包括北美持續產能擴張投資的資本支出約為 3600 萬美元。本季度的現金轉換率為 105%，而 2022 年為 49%。我們現在的轉換率高於平均水平，這是由於供應鏈限制的放鬆帶來的與庫存相關的營運資本收益。

In terms of other capital deployment, we acquired Isolere Bio for $62 million and returned $32 million to shareholders inclusive $28 million in the form of dividends and $4 million in share repurchase. Our balance sheet is strong, and we ended the quarter with a net debt-to-EBITDA ratio of 0.7x.

在其他資本配置方面，我們以 6200 萬美元收購了 Isolere Bio，並向股東返還了 3200 萬美元，其中包括 2800 萬美元的股息和 400 萬美元的股票回購。我們的資產負債表表現強勁，本季度末淨債務與 EBITDA 之比為 0.7 倍。

Now moving to our updated fiscal '23 outlook. First, on sales. We expect fiscal 2023 sales to increase between 3% and 5%, a midpoint of which is in line with our previous guidance. This includes pricing of approximately 8% and a negative impact from currency translation of about 4%. As forecasted, as the year has progressed, we have lapped stronger prior year pricing actions each quarter resulting in less of an incremental benefit as we move through the year. We expect this tend to continue in the fourth quarter.

現在轉到我們更新的 23 財年展望。首先，關於銷售。我們預計 2023 財年的銷售額將增長 3% 至 5%，其中中點與我們之前的指引一致。這包括大約 8% 的定價和大約 4% 的貨幣換算的負面影響。正如預測的那樣，隨著時間的推移，我們每個季度都採取了更強有力的上一年定價行動，導致我們在這一年中的增量收益減少。我們預計這種趨勢將在第四季度繼續。

For Mobile Solutions, we are anticipating a sales increase of between 2% and 4%, consistent with our prior expectations. On-Road and Off-Road sales are forecast to be up, mid-single digits and high single digits, respectively. Aftermarket sales are projected to be up low-single digits. For the Industrial Solutions segment, we are increasing the midpoint of our guidance, with sales now expected to increase between 11% and 13%, up from 8% to 12% previously. Robust volume growth and pricing essentially across the entire segment are driving the improvement.

對於移動解決方案，我們預計銷售額將增長 2% 至 4%，這與我們之前的預期一致。預計公路和越野銷量將分別增長，中個位數和高個位數。售後市場銷售額預計將達到低個位數。對於工業解決方案部門，我們正在提高我們指導的中點，現在預計銷售額將增長 11% 至 13%，高於之前的 8% 至 12%。基本上整個細分市場的強勁銷量增長和定價正在推動改善。

Within Industrial Solutions, IFS sales strengthened by robust dust collection and industrial gases part sales are forecast to grow low-double digits, an increase from high-single digits previously.

在工業解決方案中，IFS 銷售額因強勁的除塵和工業氣體部件銷售額而增長，預計將增長兩位數，高於之前的高個位數。

Aerospace and Defense sales are projected to grow mid-teens, up from our previous low double-digit expectation. Within the Life Sciences segment, we are now forecasting a sales decline between 10% and 12% versus a decline between 5% and 9% previously. The main drivers of the reduced outlook are continued Disk Drive sales weakness and the change in timing of Solaris or bioprocessing equipment sales.

航空航天和國防銷售額預計將增長 15% 左右，高於我們之前低兩位數的預期。在生命科學領域，我們現在預測銷售額將下降 10% 至 12%，而此前為 5% 至 9%。前景下調的主要原因是磁盤驅動器銷售持續疲軟以及 Solaris 或生物加工設備銷售時間的變化。

Now on operating margin. We expect full year operating margin to fall within a range of between 14.4% and 14.8%, slightly down from our previous guidance of between 14.6% and 15.0%. This is mainly a result of our Life Science investments as we focus on scaling our pre-revenue acquisitions. As we have consistently stated, we continue to exercise expense discipline particularly given the uncertain macro environment. However, we are committed to building for the future through our reinvestments back into the business.

現在是營業利潤率。我們預計全年營業利潤率將在 14.4% 至 14.8% 之間，略低於我們之前 14.6% 至 15.0% 的指引。這主要是我們生命科學投資的結果，因為我們專注於擴大收入前的收購。正如我們一貫聲明的那樣，我們將繼續執行費用紀律，特別是在不確定的宏觀環境下。但是，我們致力於通過對業務的再投資來建設未來。

The midpoint of our updated operating margin range reflects a 110 basis point increase from the prior year and is driven by gross margin expansion. In terms of EPS, we are maintaining our outlook for the year, but narrowing our adjusted guidance range to between $3 and $3.06 from $2.99 and $3.07 previously. The midpoint of this range represents an approximately 13% increase from a record fiscal 2022.

我們更新後的營業利潤率範圍的中點反映出比上一年增加了 110 個基點，並且受到毛利率擴張的推動。就每股收益而言，我們維持今年的展望，但將調整後的指導範圍從之前的 2.99 美元和 3.07 美元縮小至 3 美元和 3.06 美元之間。該範圍的中點代表比創紀錄的 2022 財年增長約 13%。

Now on to our balance sheet and cash flow outlook. Cash conversion is forecast in the range of 105% to 115%, slightly down from 110% to 120%, however, still above our historic averages. Our above-average cash conversion this year is driven by a move towards more normalized working capital levels as we increase inventory efficiency through optimization of our processes and as supply chain conditions normalize.

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 105% 至 115% 之間，略低於 110% 至 120%，但仍高於我們的歷史平均水平。我們今年高於平均水平的現金轉換是由於我們通過優化流程和供應鏈條件正常化來提高庫存效率，從而使營運資本水平更加正常化。

Our capital expenditures forecast remains at $115 million to $130 million and is heavily weighted towards growth initiatives, including investments in capacity expansion and tooling and equipment for new products and technology.

我們的資本支出預測保持在 1.15 億美元至 1.3 億美元之間，並且主要用於增長計劃，包括對產能擴張以及新產品和技術的工具和設備的投資。

With respect to other capital allocation priorities, we continue to evaluate the best acquisition opportunities for our Life Sciences business and maintain our long-standing commitment to dividends and share repurchases.

關於其他資本配置優先事項，我們繼續評估生命科學業務的最佳收購機會，並保持我們對股息和股票回購的長期承諾。

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. As we close out another record quarter, I want to thank my Donaldson colleagues around the globe for their dedication and hard work. With this outstanding team in place, the future is bright, and I'm excited about what lies ahead for our company. I spoke earlier about some of the game-changing opportunities we are pursuing in our Life Sciences segment.

謝謝，斯科特。在我們結束另一個創紀錄的季度之際，我要感謝我在全球的唐納森同事的奉獻精神和辛勤工作。有了這支優秀的團隊，未來是光明的，我對我們公司的未來感到興奮。我之前談到了我們在生命科學領域追求的一些改變遊戲規則的機會。

We are also investing in pursuing growth in our Mobile Solutions and Industrial Solutions segments. For example, in Mobile, we are making progress on building our portfolio of alternative power solutions. And in Industrial, we are pushing ahead with our goal of increasing our Industrial Services business by leveraging our connected solutions offerings. Underpinning all of our future growth initiatives is Donaldson's commitment to our people, customers and communities through our purpose of advancing filtration for a cleaner world.

我們還投資於追求移動解決方案和工業解決方案領域的增長。例如，在移動領域，我們正在構建替代電源解決方案組合方面取得進展。在工業領域，我們正在推進我們的目標，即通過利用我們的互聯解決方案產品來增加我們的工業服務業務。支持我們所有未來增長計劃的是唐納森通過我們推進過濾以創造一個更清潔的世界的目標，對我們的員工、客戶和社區的承諾。

To that end, coinciding with our Investors Day in April, we published our 2022 Sustainability Report, in which we outlined 2030 ESG ambitions. In summary, by fiscal 2030, we are targeting an absolute reduction of Scope 1 and 2 greenhouse gas emissions by 42% from fiscal 2021 baseline.

為此，恰逢 4 月的投資者日，我們發布了 2022 年可持續發展報告，其中概述了 2030 年 ESG 目標。總而言之，到 2030 財年，我們的目標是將範圍 1 和範圍 2 溫室氣體排放量從 2021 財年基準絕對減少 42%。

We expect to reach 35% in terms of women and global leadership positions, starting from a January 2023 baseline. And we plan to increase charitable giving through the Donaldson Foundation by 25% every 4 years, giving cumulatively at least $13.5 million starting from fiscal year 2022.

從 2023 年 1 月的基線開始，我們預計女性和全球領導職位的比例將達到 35%。我們計劃每 4 年通過唐納森基金會增加 25% 的慈善捐贈，從 2022 財年開始累計捐贈至少 1350 萬美元。

In closing, we look forward to reporting on the progress we are making towards all of our key strategic initiatives and longer-term financial goals in the future.

最後，我們期待報告我們在實現所有關鍵戰略計劃和未來長期財務目標方面取得的進展。

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 Nathan Jones with Stifel.

（操作員說明）您今天的第一個問題來自 Stifel 的 Nathan Jones。

Good morning, everyone. Maybe we could just start with a bit more color on gross margins. Obviously, you guys talked about 2Q being unseasonably high, but gross margin is a bit lower than maybe I would have expected here with price catching up to cost. So maybe you could talk about the inputs there? I mean I assume Disk Drive is higher gross margin, so it's probably a headwind there. Just where we could -- where you think once we see all the normalization of price cost and the headwinds out of Disk Drive maybe, what you're thinking about for gross margins at a normalized level?

大家，早安。也許我們可以從毛利率的更多顏色開始。顯然，你們談到第二季度反常地高，但毛利率比我預期的要低一點，因為價格趕上了成本。那麼也許你可以談談那裡的投入？我的意思是我假設磁盤驅動器的毛利率更高，所以它可能是一個逆風。就在我們可以的地方——你認為一旦我們看到所有價格成本的正常化和磁盤驅動器的逆風，你在考慮正常水平的毛利率是什麼？

Nathan, this is Scott. So yes, we've had kind of an interesting run of gross margins. The first quarter was 33.9%, second quarter 34.5% and then the third quarter came in at 33%. As you remember, we said at the end of the second quarter, we expected third quarter to be down and it was. And there continues to be a lot of things going on in our income statement with inflation and inventory costing and the pretty significant reduction in inventories that we took this quarter along with a decline in Disk Drive sales.

內森，這是斯科特。所以是的，我們有一種有趣的毛利率。第一季度為 33.9%，第二季度為 34.5%，第三季度為 33%。你記得，我們​​在第二季度末說過，我們預計第三季度會下降，而且確實如此。我們的損益表中繼續發生很多事情，包括通貨膨脹和庫存成本核算，以及我們本季度的庫存大幅減少以及磁盤驅動器銷售額的下降。

So there's really a lot in the soup there, but we landed at 33%. We expect fourth quarter to certainly be up from third quarter as things normalize and hopefully our price cost situation for the whole world starts to kind of slow down and balance out a bit. So it was a little bit tougher quarter on gross margin. We expected it to come down and it did. We expect fourth quarter to be up, so that's kind of a high-level summary for you.

所以那裡的湯真的很多，但我們降落在 33%。我們預計第四季度肯定會比第三季度有所上升，因為事情會正常化，並且希望我們在全世界的價格成本情況開始放緩並有所平衡。所以這個季度的毛利率有點​​艱難。我們預計它會下降，它確實下降了。我們預計第四季度會結束，所以這對你來說是一個高級總結。

So we're going to get maybe between 33.5% and 34% for the full year. If I go back a few years, I know you had some capacity issues back in like '19 and '20 and obviously, COVID has created a lot of noise. We're kind of in the 34% to 35% range before that. Is that a reasonable expectation for what the business should be running at for gross margins?

因此，我們全年的增長率可能在 33.5% 到 34% 之間。如果我回到幾年前，我知道你在 19 年和 20 年時遇到了一些容量問題，顯然，COVID 產生了很多噪音。在那之前，我們有點處於 34% 到 35% 的範圍內。這是對企業毛利率的合理預期嗎？

Yes, Nathan, this is Tod. Yes, it is. And the one new variable that we have coming in there is obviously all of the investments that we're putting into the Life Sciences activities, which will give us a little bit of a mix pressures, but we would believe still 34% to 35% is reasonable and where we expect to land.

是的，內森，這是托德。是的。我們進入的一個新變量顯然是我們投入生命科學活動的所有投資，這會給我們帶來一些混合壓力，但我們相信仍有 34% 到 35%是合理的，也是我們期望著陸的地方。

And maybe just 1 more on those investments in Life Sciences. Can you talk about the magnitude of those, the duration of those? I mean I would assume that those are likely to continue to step up year-on-year as we go forward as you continue to invest in those businesses. I mean, like you said, we're not even at them generating any revenue yet, so is there an expectation that this is an investment cycle that lasts a few years here?

在生命科學領域的投資中，也許只有 1 個。你能談談這些的嚴重程度和持續時間嗎？我的意思是，我認為隨著您繼續投資這些業務，隨著我們前進，這些業務可能會繼續同比增長。我的意思是，就像你說的，我們甚至還沒有在他們身上產生任何收入，所以是否期望這是一個持續幾年的投資週期？

Yes, Nathan. So the way we look at this thing so far, it's actually evolving as we would have expected. We believe that we're going to give you a bit more information here when we guide full year in about 90 days. But we would expect, clearly, as we see through the balance of this fiscal year for it to be all in the investment column for the balance I said fiscal -- for the balance of this calendar year, it will be all in the investment column, but we'll come out with more detail here when we full year guide.

是的，內森。所以到目前為止我們看待這件事的方式，它實際上正在按照我們的預期發展。我們相信，當我們在大約 90 天內指導全年時，我們會在這里為您提供更多信息。但我們顯然希望，正如我們通過本財政年度的餘額看到的那樣，它全部在我所說的財政餘額的投資欄中 - 對於本日曆年的餘額，它將全部在投資欄中，但我們會在全年指南中提供更多詳細信息。

Your next question comes from the line of Brian Drab with William Blair.

你的下一個問題來自 Brian Drab 和 William Blair 的台詞。

I was wondering if you could just start by elaborating a little bit on the timing -- this issue, the timing of the bioprocessing equipment and when does it ship? When was it expected to ship, et cetera?

我想知道你是否可以從詳細說明時間開始——這個問題，生物加工設備的時間以及它什麼時候發貨？預計什麼時候發貨等等？

Yes. Brian, this is Tod. So 3 components, right? Solaris is already revenue generating, it's project-based. That is the project type of activities that could go from quarter-to-quarter based upon when customers are ready to take shipments, and so we're actually on plan to meet what was in the full year guide for Solaris' activities and shipments this year, will again guide next year here in about 90 days.

是的。布賴恩，這是托德。那麼 3 個組件，對嗎？ Solaris 已經在產生收入，它是基於項目的。這是項目類型的活動，可能會根據客戶準備好接收貨物的時間逐個季度進行，因此我們實際上計劃在今年滿足 Solaris 活動和發貨的全年指南年，將在大約 90 天后再次指導明年。

But then when you look at the other 2, Isolere Bio and Purilogics, that's revenue generating ahead of us that their revenue today is 0. And so that -- we're planting solid seeds for future growth with both of those activities in both of those businesses, so that's future revenue. We'll give you a little bit more color here next year or when we report next fiscal, but certainly, we would expect that to be more headwinds for the balance of this calendar year.

但是當你看看其他 2 個，Isolere Bio 和 Purilogics，它們在我們之前產生的收入，他們今天的收入是 0。因此——我們正在為未來的增長播下堅實的種子，這兩個活動在這兩個這些業務，所以這是未來的收入。明年或我們報告下一個財政年度時，我們會在這裡給你更多的顏色，但當然，我們預計這將對本日曆年的平衡造成更多不利因素。

Okay. All right. And then in the Disk Drive business, at the analyst meeting that you had recently, I was -- I guess, under the impression that headwind in this fiscal year, but normalizing and maybe, I don't know, I guess I got the impression, at least be stable in the next fiscal year. Is that a growth business do you think going forward? Or is it stable? And then the whole segment starts to grow when we get the Life Sciences -- the newer Life Sciences pieces growing?

好的。好的。然後在磁盤驅動器業務中，在你最近舉行的分析師會議上，我是——我想，在本財年的逆風中，但正在正常化，也許，我不知道，我想我得到了印像中，至少下個財年要穩定。您認為這是一項增長業務嗎？還是穩定？然後，當我們獲得生命科學時，整個細分市場開始增長——更新的生命科學部分在增長？

We believe that we're stabilizing now flattening, if you will. It's been a very difficult run for that business, almost cut in half within this fiscal year. For example, we have taken the necessary cost actions to support the current levels of that business. We're flattening at this point in time. We think we'll start to crawl forward or get slight lift for the balance of this calendar year, so it will turn into a slight growth business looking forward.

如果你願意的話，我們相信我們正在企穩，現在趨於平緩。該業務的運行非常艱難，在本財年幾乎減少了一半。例如，我們已採取必要的成本措施來支持該業務的當前水平。我們在這個時間點趨於平緩。我們認為我們將開始向前爬行或在本日曆年的餘額中略有提升，因此它將變成一個小幅增長的業務。

And then just lastly, I missed it. What did you say about Food and Beverage in the most recent period? How did that business do specifically?

最後，我錯過了。您最近一段時間對食品和飲料有什麼看法？那項業務具體是怎麼做的？

Yes. Food and Beverage did really strong again, continues to do quite well in the portfolio. And at this point in time, we're up in local currency, low double digits in the quarter and continuing to expand and really are very happy with our performance.

是的。食品和飲料再次表現強勁，在投資組合中繼續表現出色。在這個時間點，我們以當地貨幣計算上漲，本季度兩位數低，並且繼續擴張，我們對我們的表現非常滿意。

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。

This is Dan Rizzo on for Laurence. Just with in regards to China, just given everything that's kind of occurred and is occurring, have your expectations for the region been kind of, I don't know, have they diminished at all as we look in the next 2 to 3 quarters, just given the, I guess, the lack of a strong rebound as of yet?

這是勞倫斯的丹·里佐。就中國而言，考慮到已經發生和正在發生的一切，你對這個地區的期望是否有點，我不知道，在接下來的 2 到 3 個季度中，它們是否已經完全降低，只是考慮到，我猜，到目前為止還沒有強勁反彈？

Not at all. Actually, when you look at China and the opportunity for the company long term, it remains very strong. We continue to win national based programs, which will continue to gain share within region. I just want to remind everyone that we are in China to support China. We are not a China-based exporter, for example, it's China to support China-based customers, largely nationally now with technologies such as PowerCore.

一點也不。實際上，當你審視中國和公司的長期機遇時，它仍然非常強勁。我們繼續贏得基於國家的計劃，這些計劃將繼續在區域內獲得份額。我只是想提醒大家，我們來中國是為了支持中國。例如，我們不是中國的出口商，而是支持中國客戶的中國，現在主要是在全國范圍內使用 PowerCore 等技術。

And the thing that's a bit muted with China is just simply the economic recovery, obviously, and so we're experiencing that. But even given the careful outlook on China's based economy, we continue to win programs, which gives us confidence in the long-term direction of China.

很明顯，對中國有點沉默的只是經濟復甦，所以我們正在經歷這一點。但即使考慮到對中國基礎經濟的謹慎展望，我們繼續贏得項目，這讓我們對中國的長期方向充滿信心。

Okay. And then one of the things you mentioned, I think, was labor cost being up. Well, that's except -- understandable, but you also mentioned to be more hiring. I was wondering if it's hard to find people now still given what we're reading with labor tightness and if you are going to be doing significantly more hiring over the next couple of quarters or years or whatever?

好的。然後你提到的其中一件事，我認為是勞動力成本上升。好吧，那是可以理解的，但你也提到要招聘更多人。我想知道，鑑於我們正在閱讀的勞動力緊張的情況，現在是否仍然很難找到人，以及您是否打算在接下來的幾個季度或幾年內進行更多的招聘？

So within our manufacturing base, if you will, it's a little bit different by region. I would say that within the U.S., it's certainly improved, but not great, not pre-COVID based levels, but certainly improved. Within Europe, it's fine. Asia, it's fine. Latin America, it's strong. So really, the headwinds really and the concerns, if anything, are U.S.-based.

所以在我們的製造基地內，如果你願意的話，它因地區而異。我會說在美國，它肯定有所改善，但不是很好，不是基於 COVID 之前的水平，但肯定有所改善。在歐洲，這很好。亞洲，沒問題。拉丁美洲，它很強大。所以說真的，逆風和擔憂，如果有的話，都是基於美國的。

Within salary-based positions, little bit more careful everywhere actually. People are just being careful to come on board. We do expect to be able to support the expansions that we have of the strategic plans that we have. So we have to work a little bit harder in order to get there, but we're pretty pleased with our progress.

在基於薪水的職位中，實際上到處都要小心一點。人們只是小心翼翼地加入進來。我們確實希望能夠支持我們擁有的戰略計劃的擴展。所以我們必須更加努力地工作才能到達那裡，但我們對我們的進步感到非常滿意。

Okay. And then final question. On the free cash flow conversion, can you just remind us what the long-term target is? I know it was elevated because of all the fluctuations, but what should we think about as we model out over the next couple of years?

好的。然後是最後一個問題。關於自由現金流轉換，您能否提醒我們長期目標是什麼？我知道由於所有的波動，它有所提高，但是在接下來的幾年中，我們應該考慮什麼？

Yes. So we've had kind of unusual cash conversion as I'm sure you've seen, right? So we took inventories up by $100 million during COVID to help fight the supply chain and make sure we were living up to our commitments to our customers, and then we got into this year, we said we were going to take that $100 million out.

是的。所以我們有一種不尋常的現金轉換，我相信你已經看到了，對吧？因此，我們在 COVID 期間將庫存增加了 1 億美元，以幫助對抗供應鏈並確保我們履行對客戶的承諾，然後我們進入今年，我們說我們將拿出這 1 億美元。

As of the third quarter, our inventory has gone from $502 million down to $449 million, so we've made good progress there, and you're starting to see that flow through our cash conversion this year. And if you go to Page, I guess, 99 or the -- my slides in the investor deck, we said that our longer-term average was about 85% on cash flow conversion.

截至第三季度，我們的庫存已從 5.02 億美元下降到 4.49 億美元，因此我們在這方面取得了良好進展，你開始看到今年通過我們的現金轉換產生的流動。如果你去佩奇，我猜，99 或 - 我在投資者甲板上的幻燈片，我們說我們的長期平均現金流轉換率約為 85%。

(Operator Instructions) Your next question comes from the line of Rob Mason with Baird.

（操作員說明）您的下一個問題來自 Rob Mason 與 Baird 的對話。

Tod, when you were commenting on the Mobile Solutions business, Aftermarket, you talked about the OE dealer channel bringing inventory down to normal levels. Is that action -- is that activity destocking activity complete here in the third quarter? And then I'm also just curious what kind of impact that had on the third quarter Aftermarket business as well.

Tod，當您評論移動解決方案業務、售後市場時，您談到了 OE 經銷商渠道將庫存降至正常水平。那是行動——去庫存活動是否在第三季度完成？然後我也很好奇這對第三季度售後市場業務也產生了什麼樣的影響。

So what you see across the OE channel in Mobile Solutions aftermarket, specifically to OE is a step down in the third quarter. So think in terms of certainly teens level being pulled out in the quarter, whereas on an independent channel, you would see that we have growth at the revenue level, so call it low to mid-single digits growth on the independent.

因此，您在移動解決方案售後市場的 OE 渠道中看到的，特別是 OE 是第三季度的下降。因此，考慮到本季度肯定有青少年水平被拉出，而在獨立渠道上，您會看到我們在收入水平上有增長，因此將其稱為獨立的中低個位數增長。

Now that means volume on the independent is slightly down based upon pricing, so you'll see a little bit of a pullback there. That would be the behavior that we would have expected because they were never able to actually get their stock levels up to where we would have expected them to and the OEs kind of won out, so the OEs are pulling it back down. We would expect that to kind of normalize here as we get through the summer, but the independent channel, we feel is that pull-through level is pretty comfortable at this point.

現在，這意味著獨立電影的銷量會根據定價略有下降，所以你會看到那裡出現了一些回落。那將是我們所期望的行為，因為他們永遠無法真正將他們的庫存水平提高到我們預期的水平，而 OE 有點贏了，所以 OE 正在將其拉低。我們希望隨著夏季的到來，這種情況會在這裡正常化，但獨立渠道，我們覺得此時的拉動水平相當舒適。

That's helpful. And just -- I'm doing some quick back of the math -- or back of the envelope math here, but it looks like for the First-fit Mobile business in the fourth quarter, the revenue would decelerate sequentially. I just wanted to check that. And if that's the case, is that a function of just normal seasonality? Or were there some catch-up shipments in the third quarter?

這很有幫助。只是 - 我正在做一些快速的數學運算 - 或者在這裡進行數學運算，但對於第四季度的 First-fit Mobile 業務來說，收入似乎會連續減速。我只是想檢查一下。如果是這樣的話，這只是正常季節性的作用嗎？還是第三季度有一些補貨？

Yes. So actually, we would see it just kind of be a normal seasonality type of activity for us. Very comfortable with the First-fit side of production at this point based upon what we're seeing in backlogs, et cetera. The First-fit continues to do quite well. We're happy with it. And that's across all end markets, construction, ag, mining, First-fit on the over-the-road trucks. It was the Aftermarket that kind of came in a little bit more on the pull back to the OE side this quarter than we would have expected.

是的。所以實際上，我們會認為這對我們來說只是一種正常的季節性活動。根據我們在積壓等方面看到的情況，目前對生產的首次適配方面非常滿意。 First-fit 繼續做得很好。我們很高興。這適用於所有終端市場、建築、農業、採礦業，首次安裝在公路卡車上。售後市場在本季度回歸 OE 方面的表現比我們預期的要多一些。

Sure. And then just finally, a larger question around price. You did take up your price expectations for the full year. I'm just curious what were the main drivers behind that increase? And then how do you think about pricing going forward from here to the extent that you noted raw material prices have kind of normalized, but to the extent labor is still a pressure, your ability to offset the labor impact if needed?

當然。最後，關於價格的更大問題。你確實接受了全年的價格預期。我只是好奇這種增長背後的主要驅動因素是什麼？然後你如何看待從這裡開始定價到你注意到原材料價格已經正常化的程度，但在某種程度上勞動力仍然是一個壓力，你是否有能力在需要時抵消勞動力的影響？

Maybe I'll let Scott start here with the first part of the question, then I'll jump in for additional color on the second half.

也許我會讓斯科特從問題的第一部分開始，然後我會在下半部分加入更多顏色。

Yes, Rob, this is Scott. So we did take our guide for price up 2%. I mean part of that is just a refinement of our calculation and our estimate for the year. Part of that is related to the labor comments Tod previously made. And we got to continue to make sure we manage our price and cost, and we're going to continue to adjust prices for the next 10 years. If our costs are going up, we have to be compensated for that in the market, and we're going to pass those prices on.

是的，羅伯，這是斯科特。所以我們確實採用了價格上漲 2% 的指南。我的意思是，其中一部分只是我們對今年的計算和估計的改進。部分原因與 Tod 之前發表的勞工評論有關。我們必須繼續確保我們管理我們的價格和成本，我們將在未來 10 年繼續調整價格。如果我們的成本上升，我們必須在市場上得到補償，我們將轉嫁這些價格。

So a 2% increase is within a normal range for us, I would say. But we continue to push price where appropriate and we're going to continue to drive those increases into the market to just make sure we have a reasonable commercial relationship with our customers and that we treat our suppliers properly.

所以我會說，2% 的增長對我們來說是正常範圍內的。但我們繼續在適當的時候推高價格，我們將繼續推動這些增長進入市場，以確保我們與客戶建立合理的商業關係，並確保我們正確對待我們的供應商。

Yes. So I would say that we've returned to a more normal behaving price activity across the company in all regions of the world. However, I also want to say that we remain very committed to price cost recovery, and so we keep an eye on it, which means we would take an out-of-cycle action should that be necessary.

是的。所以我想說我們已經恢復到整個公司在世界所有地區的更正常的行為價格活動。但是，我還想說，我們仍然非常致力於價格成本的回收，因此我們會密切關注它，這意味著如果有必要，我們會採取周期外的行動。

This concludes our Q&A session for today. I now turn the call back to Tod Carpenter for closing remarks.

今天的問答環節到此結束。我現在將電話轉回給 Tod Carpenter 以作結束語。

That concludes the call today. Thanks to everyone who participated, and I look forward to reporting our fourth quarter results in late August. Have a great rest of the week. Goodbye.

今天的電話會議到此結束。感謝所有參與的人，我期待著在 8 月下旬報告我們的第四季度業績。好好休息一周。再見。

This concludes today's call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連接。