Modine Manufacturing Company · NYSE:MOD
Modine Manufacturing — Investor Presentation (December 2015)
25 slides from Modine Manufacturing's investor presentation, December 2015
Slide 1: Modine Manufacturing Company Investor Presentation
Modine Manufacturing Company Investor Presentation December 2015
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: Modine Overview
Modine Overview A Global Leader In Thermal Management Technology And Solutions Ticker: NYSE: MOD EGR Cooler Condenser Founded: 1916 in Racine, WI 2015 Sales: $1.5 billion Employees: 6,900 Worldwide Oil Cooler Liquid Charge Air Cooler Global Footprint: HQ in Racine, WI with operations in North Americ
Slide 4: Diverse, Global End Markets & Customer Profile
Diverse, Global End Markets & Customer Profile Corporate Headquarters European Headquarters Bonlanden, Germany Asian Headquarters FY’15 Sales Shanghai, China Racine, WI 11 Locations serving Europe 5 Locations and 2 JVs 9 Locations serving serving Asia customers North America & markets São Paulo, Bra
Slide 5: Investment Highlights
Investment Highlights Product Portfolio • Leader in thermal management technology and solutions Positioned to Leverage • Over 2,200 patents –innovations have set industry standards Current Market Trends • Products well positioned for global energy efficiency and emissions trends • Strong core positi
Slide 6: Well Positioned for Global Market Trends
Well Positioned for Global Market Trends Modine Products Increase Energy Efficiency • Increase fuel efficiency Global Market Trends • Reduce vehicular emissions Reduce Greenhouse Gas • Leverage waste heat recovery Emissions technology • Improve efficiency of Recover / Reuse HVAC&R equipment Waste He
Slide 7: Strong Product Portfolio
Strong Product Portfolio Vehicular – 84% Industrial – 16% Powertrain Engine (EPG) Coils Building HVAC Cooling (PTC) PRIORITIZE EXECUTE growth MAINTAIN strong EXPAND product investment for and consolidation market position offering and reach growth strategy • Cooling module • Oil cooler • Copper RTPF
Slide 8: Vehicular (Powertrain & Engine) Market Overview
Vehicular (Powertrain & Engine) Market Overview Market Size Powertrain cooling $12-14B Engine Products $5-6B 5-Year Unit Growth Rates Powertrain Cooling 2 - 5% Engine 5 - 10% Sales by Product Group (FY'15) Sales by Geography (FY'15) 8
Slide 9: Vehicular Position and Strategy
Vehicular Position and Strategy Leverage and optimize powertrain cooling Capitalize on engine cooling growth trends Industry Trends and Drivers Modine Priorities Powertrain cooling – Address underperformers in – Focus on fuel economy is driving the global product portfolio need for higher efficiency
Slide 10: Industrial (BHVAC & Coils) Market Overview
Industrial (BHVAC & Coils) Market Overview Market Size Building HVAC $3.0-3.3B Coils $2.0-2.5B 5-Year Unit Growth Rates Building HVAC 5-10% Coils 4-7% Sales by Product Group (FY'15) Sales by Geography (FY'15) 10
Slide 11: Industrial (BHVAC & Coils) Position & Strategy
Industrial (BHVAC & Coils) Position & Strategy Strive to be recognized as the most trusted brand in HVAC & Coils – providing integrated thermal solutions, differentiated through innovation Industry Trend and Drivers Modine Priorities Building HVAC – Drive organic growth through – Increased focus on
Slide 12: Transformation Goals
Transformation Goals Strengthen Diversify • Optimize global • Organic and inorganic investment manufacturing capabilities in BHVAC, Coils, and other • Execute global procurement Industrial applications project • Operational & SG&A GOALS: expense reductions • Reduced customer concentration and cyclic
Slide 13: Our Journey to Strengthen, Diversify & Grow
Our Journey to Strengthen, Diversify & Grow Strengthen, Reorganization European Four Point Plan Diversify & Phase Restructuring 2007 - 2011 Grow 2005 - 2007 2012 - 2015 2015 - 2018 • Continuous • Rationalized • Lowered annual • Strengthen- target $40- improvement - product portfolio by operating cos
Slide 14: Financial Review
Financial Review Highlights FY13 vs. FY 15 Financial Highlights • Revenue up 9% (+11% excluding FX impact) ($ in millions, except per share amounts) • Gross margin up 130 bps FY Ended 2013 2014 2015 March 31, • Adjusted operating income* up $23 million or 55% Revenues $1,376 $1,478 $1,496 • Signific
Slide 15: Conclusion
Conclusion • Robust product portfolio positioned to leverage current market trends to increase fuel economy, reduce vehicular emissions, improve indoor air quality and increase energy efficiency • Strong core vehicular business and growing industrial with strategies to capitalize on industry trends
Slide 16: Appendix
Appendix
Slide 17: Americas (44% of Net Sales)
Americas (44% of Net Sales) • Seven manufacturing facilities – announced plans to FY 2015 Sales Mix close Washington, Iowa plant • Diversified revenue mix across major end-markets 17% 18% • Segment well positioned for future success based on Heavy Truck improved manufacturing footprint and cost stru
Slide 18: Europe (38% of Net Sales)
Europe (38% of Net Sales) • Seven manufacturing facilities serving Europe FY 2015 Sales Mix • Recently consolidated manufacturing operations in Germany, restructuring winding down • Managing launch activity mainly in oil cooler and liquid charge air cooler (LCAC) products • Key customers: VW, Daimle
Slide 19: Asia (5% of Net Sales)
Asia (5% of Net Sales) • Five manufacturing facilities serving China, India, FY 2015 Sales Mix Japan and Korea (2 Joint Ventures) • Strategic focus on creating new business opportunities with local customers • Diversifying our business model; high current exposure to excavator market • More stringen
Slide 20: Building HVAC (13% of Net Sales)
Building HVAC (13% of Net Sales) • Five facilities serving North America, United FY 2015 Sales Mix Kingdom, South Africa and the Middle East • Complementary business that provides diversification to Modine’s vehicular segments • Strong financials due to product differentiation, manufacturing efficie
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted operating income and margin ($ in millions) Years ended March 31, 2013 2014 2015 Operating income (loss) $ (0.6) $ 37.2 $ 52.7 Restructuring related expenses 17.0 20.4 4.7 Impairment charges 25.9 3.2 7.8 Gain on sale of wind tunnel - - (3.2) Brazil legal reserve - -
Slide 22: Non-GAAP Reconciliations
Non-GAAP Reconciliations ROACE (Return on Average Capital Employed) ($ in millions) Years ended March 31, 2013 2014 2015 Operating income (loss) $ (0.6) $ 37.2 $ 52.7 Restructuring related expenses 17.0 20.4 4.7 Impairment charges 25.9 3.2 7.8 Gain on sale of wind tunnel - - (3.2) Brazil legal reser
Slide 23: Non-GAAP Reconciliations
Non-GAAP Reconciliations Net debt-to-capital ($ in millions) Years ended March 31, 2013 2014 2015 Total debt $ 163.6 $ 164.4 $ 148.7 Less: cash and cash equivalents 23.8 87.2 70.5 Net debt 139.8 77.2 78.2 Total equity 268.3 428.6 360.6 Capital $ 408.1 $ 505.8 $ 438.8 Net debt-to-capital 34.3% 15.3%
Slide 24: Non-GAAP Reconciliations
Non-GAAP Reconciliations Segment adjusted operating income and margin ($ in millions) Years ended March 31, Americas (unaudited) 2013 2014 2015 Operating income $ 50.4 $ 49.6 $ 33.4 Restructuring expenses - 1.2 2.7 Impairment charges 1.8 1.2 7.8 Brazil legal reserve - - 3.2 Adjusted operating income
Slide 25: Non-GAAP Reconciliations
Non-GAAP Reconciliations Segment adjusted operating income and margin ($ in millions) Years ended March 31, Building HVAC 2013 2014 2015 Operating income $ 10.0 $ 9.4 $ 19.1 Loss from Airedale fire - 0.5 - Adjusted operating income 10.0 9.9 19.1 Net sales $ 139.3 $ 146.5 $ 186.3 Adjusted operating m
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