Donaldson Co. Inc. employees received nearly 400 patents last year, celebrated last week at the company’s annual inventor awards event.
The recipients included a 12-member team whose work contributed to advances in fuel-water separation technology for the Bloomington-based filtration company.
“Our patent holders and inventor awardees are vital to our continued leadership in filtration,” said Michael Wynblatt, Donaldson’s vice president and chief technology officer in a news release. “This event provides us with the opportunity to recognize their significant achievements and contributions.”
Those innovations help the company maintain its technology lead in the industry, enter new markets and produce strong quarterly results despite inflationary and supply chain constraints.
The advances are key in the inflationary environment Donaldson and other large companies are facing. Price increases help to offset inflation, but third-quarter earnings reported Thursday were still a bit down compared with a tough set of comparables from the same period last year.
The company earned $83 million, or 67 cents a share, in the quarter ended April 30, compared with $84.4 million, or 66 cents a share, last year.
The pricing actions and strong global demand for their industrial filtration products, especially for their Off-Road engine and Aftermarket parts, did lead to a better-than-expected 11.5% increase in sales to a quarterly record of $853.2 million.
Earnings missed Wall Street expectations. Analysts covering Donaldson expected third-quarter earnings per share to increase 24% to 72 cents a share on revenue of $824 million. The company’s stock lost 2% for the day.
“Looking ahead, we anticipate ongoing inflation and supply chain constraints,” said Tod Carpenter, Donaldson’s chief executive.
A big supply chain challenge in the third quarter was a shortage of a critical petrochemical product that has since been resolved, while increased raw material, freight and labor costs contributed to inflationary pressures, Carpenter said in the company’s quarterly call with analysts.
More price increases are expected, he said.
The increases so far contributed about 9% of the quarterly sales gain, while greater volume contributed 6%.
Encouraged by the latest results, the company is increasing sales guidance for the remainder of the fiscal year. The company now expects sales to increase between 14.5% and 16.5%, up from a range of 11% to 15%. It expects earnings to be between $2.67 and $2.73 a share, narrowing from a range of $2.66 to $2.76 a share.
Donaldson said in its earnings release that it is complying with all sanctions from the European Union, Great Britain and the U.S. in regard to product shipments to Russia and Belarus, which make up less than 2% of overall sales.