Donaldson Company, Inc. (NYSE:DCI) Q2 2024 Results Conference Call February 28, 2024 10:00 AM ET

Company Participants

Sarika Dhadwal - SD, IR & ESG

Tod Carpenter - Chairman, President & CEO

Scott Robinson - CFO

Conference Call Participants

Nathan Jones - Stifel

Bryan Blair - Oppenheimer

Laurence Alexander - Jefferies

Joseph Donahue - Baird

Operator

Good morning. My name is Dennis and I will be your conference operator today. At this time, I would like to welcome everyone to the Donaldson Company Second Quarter 2024 Earnings Call. [Operator Instructions].

I would now like to turn the conference over to Sarika Dhadwal, Senior Director, Investor Relations and ESG. Please go ahead.

Sarika Dhadwal

Good morning. Thank you for joining Donaldson's Second Quarter Fiscal 2024 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 details on our outlook for fiscal 2024. During today's call, we will discuss non-GAAP or adjusted results.

In the prior year period, second quarter fiscal 2023 non-GAAP results exclude pretax restructuring and other charges of $9.3 million. 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.

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

Tod Carpenter

Thanks, Sarika. Good morning, everyone. I am pleased to report our strong second quarter in which all 3 operating segments contributed to our overall sales growth, demonstrating the benefits of our diversified business model. This quarter, despite ongoing macro uncertainty, we worked to deliver Donaldson's technology-led air filtration products and services to our customers. We grew on the top line and once again delivered robust gross margin and earnings. Through the hard work and dedication of the Donaldson team, we are well on our way to a record fiscal 2024.

In Mobile Solutions, overall volumes rebounded this quarter despite pockets of ongoing end market weakness driven by strength in our Aftermarket business, where we continue to gain share. Mobile profitability hit an all-time high, with pretax profit margin in the quarter up 18%, up 300 basis points year-over-year. Mix benefits, strategic pricing as well as freight and select material cost deflation drove the results in the quarter.