#United States #Modine #Thermal Management #Racine #Fiscal 2026

Modine Reports Strong Financial Performance for the First Quarter of Fiscal 2026

Modine Manufacturing Company, a globally recognized leader in thermal management technologies, has shared its financial performance for the first quarter ending June 30, 2025. The company's results highlight robust growth in terms of sales and earnings, underpinned by strategic investments and effective management of operational costs.

First Quarter Highlights

In the latest quarter, Modine reported net sales totaling $682.8 million, marking a 3% increase compared to the previous year. The net earnings witnessed a notable rise to $51.7 million, reflecting an increase of $3.9 million or 8% year-over-year. Additionally, the earnings per share (EPS) saw an uptick to $0.95, representing a 7-cent increase from the previous year.

This performance was further complemented by an Adjusted EBITDA of $101.4 million, which also reflected a slight increase of $0.5 million compared to the prior fiscal year.

CEO Neil D. Brinker stated, "We are strategically investing in our business to enhance our competitive edge in key markets, positioning us to capitalize on growth opportunities this fiscal year and beyond."

Financial Analysis

The increase in net sales is primarily attributed to a strong performance in Modine's Climate Solutions segment. This segment alone generated $397.4 million, a remarkable 11% growth from $357.3 million last year, driven by heightened demand for data center products and HVAC technologies. The Performance Technologies segment reported a decline, generating sales of $285.5 million, down 8% from the previous year due to market weaknesses impacting heavy-duty equipment and strategic product exits.

However, the Climate Solutions segment's gross margin improved to 28.4%, up by 20 basis points, indicating better efficiency and profitability amidst operational challenges. In contrast, the Performance Technologies segment experienced a decline in gross margin, dropping to 18.2%.

Operational Efficiency and Cost Management

Despite the sales downturn in the Performance Technologies segment, Modine's overall operating income rose to $75.7 million, a 2% increase from the previous period, demonstrating the company's effectiveness in managing costs associated with sales growth and restructuring expenses. Notably, $4.8 million had to be recorded as restructuring expenses primarily related to workforce adjustments in the Performance Technologies segment.

Future Outlook

Modine has provided an optimistic outlook for fiscal 2026, projecting a 10% to 15% growth in net sales and an Adjusted EBITDA target ranging between $440 million and $470 million. The company’s leadership remains confident that upcoming manufacturing capacity expansions, particularly in the data center products market, will positively influence performance in the latter half of the fiscal year and position the company for substantial growth in the following years.

Conclusion

Modine continues to navigate the complexities of the global marketplace with strategic foresight. By investing in high-growth initiatives and maintaining a keen focus on cost management, the company is poised to enhance its market position in the thermal management sector. As fiscal 2026 unfolds, stakeholders can look forward to insights from Modine’s upcoming conference call scheduled for July 31, 2025, where further details on financial performance and strategic directions will be shared.

For more information about Modine's latest financial results and future strategies, visit Modine’s Investor Relations.