Donaldson continues to see FY17 adjusted EPS $1.50-$1.66, consensus $1.57
Donaldson reaffirms its prior full-year sales guidance for fiscal 2017. The Company continues to expect total sales between a 2 percent decline and a 2 percent increase compared with 2016. Consistent with prior guidance, the Company expects full-year sales in the Engine Products and Industrial Products segments between a 2 percent decline and a 2 percent increase when compared with the prior year. In Engine Products, the Company expects Aftermarket sales will increase from the prior year while sales of products related to production of on- and off-road heavy-duty equipment as well as commercial helicopters are expected to decline. Within the Industrial Products segment, Donaldson expects growth of Industrial Filtration Solutions' sales, primarily driven by sales of replacement parts, and year-over-year sales declines in the Gas Turbine Systems and Special Applications businesses. Donaldson continues to expect full-year 2017 operating margin between 13.3 percent and 13.9 percent, compared with adjusted operating margin of 13.2 percent in fiscal 2016. Largely driven by the impact from the Settlement in first quarter, the Company now expects its full-year effective income tax rate between 26.4 percent and 28.4 percent, compared with the prior guidance range of 26.7 percent to 28.7 percent, and other income between $15 million and $17 million, compared with prior guidance of $8 million to $10 million. Donaldson's full-year capital deployment and cash management expectations are consistent with prior guidance. The Company expects capital expenditures between $70 million and $80 million and full-year cash conversion between 90 percent and 100 percent. During fiscal 2017, the Company expects to repurchase between 2 percent and 3 percent of its outstanding shares.