Modine Manufacturing Company · NYSE:MOD
Modine Manufacturing — Q4 FY2019 Earnings Presentation
19 slides from Modine Manufacturing's earnings presentation, May 23, 2019
Slide 1: Fourth Quarter Fiscal 2019
Fourth Quarter Fiscal 2019 May 23, 2019 8:00 am CDT
Slide 2: 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,” and other similar “forward-looking” statements, as d
Slide 3: Q4 FY 2019 Highlights
Q4 FY 2019 Highlights Second year in a row of record sales and earnings Net Sales -2% +5% • Fourth quarter sales increased 3% on a constant-currency basis, driven by strong growth in BHVAC segment $566.6 $556.7 $2,212.7 $2,103.1 • Adjusted operating income flat with strong results in the CIS and BHV
Slide 4: Segment Updates
Segment Updates
Slide 5: VTS Summary
VTS Summary Sales by End Market Net Sales Adjusted Operating Income -5% -31% 8% Automotive -7% $28.7 24% 39% $356.8 Commercial Vehicle +2% $340.0 $19.9 Off-Highway +2% 8.0% 5.9% 29% Other Q4 18 Q4 19 Q4 18 Q4 19 (in millions) Sales by Product Sales by Region +4% -15% 5% Power Train Cooling -4% 41% $
Slide 6: CIS Summary
CIS Summary Sales by End Market Net Sales Adjusted Operating Income -2% +17% 8% Commercial HVAC&R -3% $14.2 20% $12.1 Data Center +9% $181.5 $178.5 72% Industrial (Power & Other) 6.7% 8.0% -14% Q4 18 Q4 19 Q4 18 Q4 19 (in millions) Sales by Product Sales by Region +9% 6% Coils -5% -12% 26% Coolers +
Slide 7: BHVAC Summary
BHVAC Summary Sales by End Market Net Sales Adjusted Operating Income +21% +79% 26% Commercial HVAC +10% $52.5 $5.9 74% Data Center +68% $43.3 $3.3 7.6% 11.2% Q4 18 Q4 19 Q4 18 Q4 19 (in millions) Sales by Product Sales by Region 20% Heating +2% +4% +46% 35% Air Conditioning +65% 13% $27 $26 Ventila
Slide 8: Financial Updates
Financial Updates MODINE
Slide 9: Select Income Statement Items
Select Income Statement Items Sales decreased $9.9M or 1.7% (In millions) Q4 2019 Q4 2018 • On a constant-currency basis, sales were up 2.6% Net Sales $556.7 $566.6 Gross profit decreased 5.1%; margin Gross Profit 91.6 96.5 negatively impacted by the VTS segment Margin 16.4% 17.0% • Stronger CIS mar
Slide 10: Cash Flow & Net Debt
Cash Flow & Net Debt • Free cash flow lower than the prior (In millions) Q4 YTD 2019 Q4 YTD 2018 year, primarily due to higher Operating cash flow $103.3 $124.2 incentive compensation payments and higher working capital levels Capital expenditures (73.9) (71.0) • Higher inventory levels were related
Slide 11: Fiscal 2020 Guidance
Fiscal 2020 Guidance (In millions) Guidance Comments Net sales $2,213 to $2,323 Flat to +5%; growth across most industrial and HVAC end-markets, slower growth in the vehicular markets and the wind-down of European truck programs +2% to +10% (+10 to +20bps); Adjusted operating income* $135 to $145 Im
Slide 12: FY 2019 Conclusion
FY 2019 Conclusion • Significant progress on the strategic review of automotive business – Automotive sales account for approximately 25% of total company revenues, representing more than $500M – Automotive margins are generally lower than the VTS segment $515.5 as a$566.1 whole – Approximately 40-5
Slide 13: Appendix
Appendix
Slide 14: Q4 GAAP Income Statement
Q4 GAAP Income Statement (In millions, except per share amounts) Q4 Q4 Better 2019 2018 (Worse) Net sales $ 556.7 $ 566.6 $ (9.9) Cost of sales 465.1 470.1 5.0 Gross profit 91.6 96.5 (4.9) SG&A expenses 64.2 63.6 (0.6) Restructuring expenses 8.9 4.5 (4.4) Impairment charges - 1.2 1.2 Operating incom
Slide 15: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted financial results (unaudited) (In millions, except per share amounts) Three months ended March 31, Twelve months ended March 31, 2019 2018 2019 2018 Operating income $ 18.5 $ 27.2 $ 109.7 $ 92.2 Restructuring expenses (a) 8.9 4.5 9.6 16.0 Strategy consulting fees (b
Slide 16: Non-GAAP Reconciliations
Non-GAAP Reconciliations Segment adjusted operating income and margin Segment adjusted operating income and margin (In millions) (In millions) Three months ended March 31, Three months ended March 31, Vehicular Thermal Solutions 2019 2018 Building HVAC Systems 2019 2018 Operating income $ 9.7 $ 24.4
Slide 17: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted tax rate (In millions) Three months ended March 31, 2019 2018 Earnings before income taxes $ 10.6 $ 20.1 (a ) Restructuring expenses 8.9 4.5 (a ) Strategy consulting fees 5.9 0.9 (a ) Environmental charges 1.3 0.3 (a ) Impairment charges - 1.2 Acquisition and integr
Slide 18: Non-GAAP Reconciliations
Non-GAAP Reconciliations Net sales - constant currency (unaudited) (In millions) Three months ended March 31, 2019 2018 Effect of Exchange Rate Net Sales - Net Sales Changes Constant Currency Net Sales Vehicular Thermal Solutions $ 340.0 $ 17.2 $ 357.2 $ 356.8 Commercial and Industrial Solutions 178
Slide 19: Non-GAAP Reconciliations
Non-GAAP Reconciliations Our fiscal 2020 guidance includes adjusted operating income and adjusted earnings per share. These are non-GAAP measures, which exclude certain cash and non-cash expenses or gains. These expenses and gains may be significant and include items such as restructuring expenses (
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