Modine Manufacturing Company · NYSE:MOD
Modine Manufacturing — Q1 FY2008 Earnings Presentation
13 slides from Modine Manufacturing's earnings presentation, Jul 17, 2007
Slide 1: Modine First Quarter Fiscal 2008 Earnings
Modine Manufacturing Company Modine First Quarter Fiscal 2008 Earnings 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements made in this press release regarding future matters are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including those regarding a positive impact from new business programs, inc
Slide 3: First Quarter Fiscal 2008 Highlights
First Quarter Fiscal 2008 Highlights • Encouraged with impact of business model changes and first quarter performance • Reported strong sales volumes across most segments – Strength in Europe, Asia, South America, Commercial Products • Increased guidance for fiscal 2008 • New “Green” business opport
Slide 4: Changing the Business Model
Changing the Business Model • Organizational changes • Manufacturing realignment • Rationalization/Focus on the core • Technology acceleration Drives significant new business wins Gross margins 18-20% Growth 9-13% ROACE 11-12% 4 4 4
Slide 5: Technology Acceleration
Technology Acceleration • Historical strength - product differentiation – Spirex radiators – BetaWeld – PF technology • World-class facilities • Unique product structure – Applications – “Pull” from the customer – “Push to the customer • New board technology committee • Intellectual property aligned
Slide 6: Quarterly Comparison
Quarterly Comparison First Quarter Fiscal 2008 2007 Change Net sales $444.1 $421.9 $22.2 Earnings from continuing operations $ 12.4 $ 20.9 $ (8.5) Effective tax rate 29.5 percent 14.4 percent 15.1 points Earnings per share from continuing operations $0.39 $0.65 $ (0.26) Return on capital employed 6.
Slide 7: Fiscal 2008 First Quarter Earnings Per Share Analysis
Fiscal 2008 First Quarter Earnings Per Share Analysis • Tax benefit -- Brazilian net operating loss provided a tax E.P.S. benefit in 2007 • Volume -- Global strength offset by decline in North American truck build rates • Commodity prices -- Gaining traction on material pass-through; signs of improv
Slide 8: First Quarter Segment Analysis
First Quarter Segment Analysis • Reflects revised segment reporting structure • Mix of segment sales is a key driver of first quarter results • South America segment consisted of one month of results in fiscal 2007 8 8 8
Slide 9: 2008 Guidance Assumptions -- Metals Pricing
2008 Guidance Assumptions -- Metals Pricing $16.50 • Copper and aluminum pricing remained in line with expectations • Copper and aluminum hedges in place • Nickel prices showed significant improvement late in the first quarter of fiscal 2008, indicating preliminary signs of material cost stabilizati
Slide 10: Fiscal 2008 Guidance
Fiscal 2008 Guidance Guidance Summary Fiscal 2007 Fiscal 2008 Low High Net sales $1.72 billion $1.70 billion $1.80 billion Gross margin (%) 16.2 16.0 16.5 Operating margin (%) 2.7 3.1 3.7 Pre-tax earnings $ 45 million $ 46 million $ 52 million Tax rate (%) 13.8 27 23 Earnings per fully diluted share
Slide 11: Gross Margin Trend
Gross Margin Trend • Willing to slow growth to increase 25% profitability 21% 22% 21% • Portfolio rationalization 18-20% 19% – Customers 16.0-16.5% – Businesses 16% • Electronics Cooling –Must meet profitability and strategic hurdles • Manufacturing base – Realignment – Modine Production System • Pr
Slide 12: Intermediate Term View
Intermediate Term View Margins 23 Gross Margin ROACE Operating Margin TARGET 9.7% 9.0% 6.7% 7.2% 4.1% 5.9% Sales Relative to Investments - Capital Turns • Industry fundamentals remain challenging • North American truck build rate recovery • Plans in place to address challenges – Changing the busines
Slide 13: Slide 13
Modine Manufacturing — Q1 FY2008 Earnings Presentation on 6ix