(By Balaseshan) Donaldson Co. Inc. (NYSE:DCI) reported a 8% increase in quarterly earnings on strong sales growth across its segments. Despite revenue missing consensus due to foreign currency translation, earnings came in line with Street's expectations.
Earnings for the fourth quarter were $70.98 million or $0.47 per share, up from $65.77 million or $0.42 per share last year. The impact of foreign currency translation lowered earnings by $3.9 million or 5.9% during the latest quarter.
Sales increased 5% to $656.83 million. Excluding foreign currency translation, sales grew 18.5% to $693.11 million.
Analysts, on average, polled by Thomson Reuters had expected a profit of $0.47 per share on sales of $672.63 million for the fourth quarter.
Sales from Engine Products increased to $398.54 million from $398.0 million, on growth in both Off-Road and On-Road Products.
Industrial Products sales rose to $258.29 million from $227.46 million, as sales growth was strong across all its three product groups led by a 51% growth in Gas Turbine Products.
Gross margin declined to 35.0% from 36.3%, primarily due to the combination of the planned ramp-up of its newest plant in Aguascalientes, Mexico, lower fixed cost absorption in Asia, and increased purchased commodity costs internationally due to the stronger U.S. dollar.
Looking ahead into the fiscal 2013, the company expects earnings of $1.82 to $1.96 per share and sales of $2.62 billion to $2.72 billion, while Street analysts predict $1.88 per share on revenue of $2.71 billion.
The company's current sales forecast is based on the Euro at $1.24 and 78 Yen to the US Dollar. Donaldson expects foreign currency translation to have a negative impact on sales for most of its fiscal year.
DCI closed Friday's regular session down 0.71% at $34.90. The stock has been trading between $25.20 and $38.89 for the past 52 weeks.