Modine Manufacturing Company · NYSE:MOD
Modine Manufacturing — Q2 2024 Earnings Presentation
17 slides from Modine Manufacturing's earnings presentation, Nov 2, 2023
Slide 1: Second Quarter Fiscal 2024
Second Quarter Fiscal 2024 November 2, 2023
Slide 2: Presenters
NEIL BRINKER President and Chief Executive Officer MICK LUCARELI Executive Vice President and Chief Financial Officer KATHY POWERS Vice President, Treasurer, and Investor Relations
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation contains statements, including information about future financial performance and market conditions, accompanied by phrases such as “believes,” “estimates,” “expects,” “plans,” “anticipates,” “intends,” “projects,” and other similar “forward-looking” stat
Slide 4: Strong Quarter
Strong Quarter ▪ Solid sales growth of 7%, driven by increases in both Climate Solutions and Performance Technologies segments ▪ Adjusted EBITDA increased 59% to $81.2M, resulting in an adjusted EBITDA margin improvement of 430 bps to 13.1%* ▪ Second quarter results are clearly ahead of our adjusted
Slide 5: Climate Solutions
Climate Solutions ▪ Revenue growth of 8%, as strong growth in data centers offset weakness in other markets ▪ Strong earnings growth, with Adjusted EBITDA up 31% resulting in a 330 bps margin improvement to 18.3%* ▪ Data center sales of $79 million, more than double the prior year ▪ Order intake con
Slide 6: Performance Technologies
Performance Technologies ▪ Revenue growth of 7%, primarily driven by higher sales to off-highway, commercial vehicle and specialty vehicle customers ▪ Excellent earnings growth with Adjusted EBITDA up 73%, resulting in a 450 bps margin improvement to 11.9%* ▪ Top and bottom line benefiting from impr
Slide 7: Climate Solutions
Climate Solutions 117% Data Centers Net Sales $275.8 ▪ Strong demand and growth for products supporting (In millions) hyperscale and colocation customers $255.9 -2% HVAC&R ▪ Heating market remains soft, but improved sequentially from Q1 ▪ Expect further improvement, but maintaining a cautious outloo
Slide 8: Performance Technologies
Performance Technologies 30% Advanced Solutions (In millions) Net Sales ▪ Growth driven by higher sales to specialty vehicle $351.7 $330.0 and coatings customers, along with higher sales of EV systems and EV components 6% Liquid-Cooled Applications ▪ Higher demand from commercial vehicle customers 2
Slide 9: Financial Review
Financial Review (In millions) Net Sales Adjusted EBITDA & (In millions) Q2 FY24 Q2 FY23 EBITDA Margin* $81.2 Net Sales $620.5 $578.8 $620.5 $578.8 Gross Profit 135.1 96.2 $51.1 13.1% % of net sales 21.8% 16.6% 8.8% SG&A expenses 68.9 58.8 % of net sales 11.1% 10.1% Q2 FY23 Q2 FY24 Q2 FY23 Q2 FY24 O
Slide 10: Cash Flow and Metrics
Cash Flow and Metrics Cash Flow and Metrics Free Cash Flow $85 million Net Debt (as of September 30) $222 million Leverage Ratio (as of September 30) 0.8x Capital Expenditures $26 million Modine Maintains Strong Balance Sheet & Liquidity ▪ Strong free cash flow in the quarter; $58M, primarily due to
Slide 11: Fiscal 2024 Outlook
Fiscal 2024 Outlook Metrics Guidance Comments FY24 Modine Global Sales Outlook Net Sales +6% to +11% $2.4B to $2.6B Adjusted EBITDA* $285M to $300M +34% to +41% Climate Solutions Raising Adjusted EBITDA Outlook After a Strong First Half Data Centers +60% – 70% HVAC & Refrigeration +2% – 5% ▪ Increas
Slide 12: Appendix
APPENDIX
Slide 13: GAAP Income Statement
GAAP Income Statement Modine Manufacturing Company Consolidated statements of operations (unaudited) (In millions, except per share amounts) Three months ended September 30, Six months ended September 30, 2023 2022 2023 2022 Net sales $ 620.5 $ 578.8 $ 1,242.9 $ 1,119.8 Cost of sales 485.4 482.6 979
Slide 14: Non-GAAP Reconciliations
Non-GAAP Reconciliations Modine Manufacturing Company Adjusted financial results (unaudited) (In millions, except per share amounts) Three months ended September 30, Six months ended September 30, 2023 2022 2023 2022 Net earnings $ 46.9 $ 24.3 $ 92.2 $ 38.6 Interest expense 6.1 4.7 12.0 8.8 Provisio
Slide 15: Non-GAAP Reconciliations
Non-GAAP Reconciliations Modine Manufacturing Company Segment adjusted financial results (unaudited) (In millions) Three months ended September 30, 2023 Three months ended September 30, 2022 Climate Performance Corporate and Climate Performance Corporate and Solutions Technologies eliminations Total
Slide 16: Non-GAAP Reconciliations
Non-GAAP Reconciliations Modine Manufacturing Company Free cash flow (unaudited) (In millions) Three months ended September 30, Six months ended September 30, 2023 2022 2023 2022 Net cash provided by operating activities $ 69.1 $ 41.6 $ 110.8 $ 56.1 Expenditures for property, plant and equipment (11
Slide 17: Non-GAAP Reconciliations
Non-GAAP Reconciliations The Company’s fiscal 2024 guidance includes Adjusted EBITDA, which is a non-GAAP financial measure. The full-year fiscal 2024 guidance for Adjusted EBITDA is based upon the Company’s estimates for interest expense of approximately $23 to $25 million, a provision for income t
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