About Modine Manufacturing

Modine Manufacturing Company provides innovative and environmentally responsible thermal management products and solutions to diversified global markets and customers in a wide array of commercial, industrial, and building heating, ventilating, air conditioning, and refrigeration (HVAC&R) markets. In addition, the company is a leading provider of engineered heat transfer systems and high-quality heat transfer components for use in on- and off-highway original equipment manufacturer (‘OEM’) vehicular applications. The company’s primary product groups include heat transfer; HVAC & refrigeration; data center cooling; air-cooled; liquid-cooled; and advanced solutions. The company’s broad portfolio of systems and solutions support its intention of improving indoor air quality, conserving natural resources, lowering harmful emissions, enabling cleaner running vehicles, and using environmentally friendly refrigerants. The company operates in 15 countries in four continents and serve customers in a wide array of HVAC&R and vehicular markets, including commercial vehicle, off-highway, automotive and light vehicle. The company’s primary customers across the globe include heating, ventilation and cooling OEMs; construction architects and contractors; wholesalers of heating equipment; agricultural, industrial and construction equipment OEMs; commercial and industrial equipment OEMs; and automobile, truck, bus, and specialty vehicle OEMs. The company partners with its customers across industries to provide sustainable components, systems, and services and solve complex heat transfer challenges to ensure their climate solutions and performance technologies work more efficiently, last longer and add comfort to people’s lives. The company works to provide the best possible thermal solutions to its customers by first assessing their entire systems to make sure the company’s products integrate seamlessly with other components. The company also focuses on product design, from raw materials to end-of-life recyclability, to optimize total cost of ownership and reduce negative environmental impacts across the product life cycle. Business Strategy The company’s purpose is to engineer a cleaner, healthier world by providing products and services that improve indoor air quality, reduce water and energy consumption, lower harmful emissions, enable cleaner running vehicles, and use environmentally friendly refrigerants. The company’s top five customers are in the commercial vehicle, off-highway and automotive and light vehicle markets. Business Segments The company operates through two operating segments, Climate Solutions and Performance Technologies. The Climate Solutions segment includes the previously-reported Building HVAC Systems (‘BHVAC’) and the Commercial and Industrial Solutions (‘CIS’) segments, with the exception of CIS Coatings. The Performance Technologies segment includes the previously-reported Heavy Duty Equipment and Automotive segments and the CIS Coatings business. Climate Solutions segment The Climate Solutions segment provides energy-efficient, climate-controlled solutions and components for a wide array of applications. The Climate Solutions segment sells heat transfer products, heating, ventilating, air conditioning and refrigeration (‘HVAC & refrigeration’) products, and data center cooling solutions. The Climate Solutions segment has strategically aligned its teams around three primary market-based verticals: heat transfer products; HVAC & refrigeration; and data center cooling. Heat Transfer Products The heat transfer products business provides heat transfer coils, including heat recovery and round tube plate fin coils, to the HVAC&R markets in North America, Europe, and Asia. Its customers include commercial and industrial equipment manufacturers, distributors, contractors, and end users in a variety of commercial and industrial applications, including commercial and residential HVAC, mobile air conditioning, refrigeration, data center management, and precision and industrial cooling. HVAC & Refrigeration The HVAC & refrigeration business provides a wide array of solutions to heating; indoor air quality; commercial and industrial refrigeration; and industrial power generation, conversion, and transmission and industrial process markets in North America, Europe, the Middle East and Africa (‘EMEA’), and China. Heating products, primarily sold to the North American residential and commercial heating markets, include unit heaters (gas-fired, hydronic, electric and oil-fired); duct furnaces (indoor and outdoor); infrared units (high- and low-intensity); and perimeter heating products (cabinet unit heaters and convectors). The primary customers for these heating products are HVAC wholesalers, installers, and end users in a variety of residential, commercial and industrial applications, including residential garages, warehousing, manufacturing, and greenhouses. In the year ended March 31, 2023 (fiscal 2023), the North American heating market experienced a modest decline, primarily driven by weakness in the residential heating market and the impact of the relatively mild winter weather this past year. Indoor air quality products, primarily sold to the North American school and commercial HVAC markets, include roof-mounted direct- and indirect-fired makeup air units; unit ventilators; single packaged vertical units; and ceiling cassettes. Customers for these indoor air quality products include mechanical contractors, HVAC wholesalers, installers, and end users in a variety of commercial and industrial applications, primarily connected to the North American education system. In fiscal 2023, the North American school and commercial HVAC markets experienced strong growth, largely driven by available federal and local government funding for ventilation improvements for schools. Refrigeration products, primarily sold to the commercial and industrial refrigeration markets in EMEA, China, and North America, include evaporator unit coolers, remote condensers, fluid coolers, gas coolers, and dry and brine coolers. Customers for these coolers and refrigeration products primarily include wholesalers, distributors and resellers, commercial and industrial OEMs, as well as contractors and end users in a variety of commercial and industrial applications, including supermarkets, refrigerated warehouses, logistic centers, cold rooms, precision and industrial cooling, hospitality, hotels, and restaurants. Power generation and conversion products, primarily sold to the industrial power generation, conversion, and transmission and industrial process markets in EMEA, China, and North America, include motor and generator cooling coils, transformer oil coolers, radiators, dryers and industrial heat exchangers. Customers for these products primarily include industrial OEMs, as well as contractors and end users in industrial applications and for capital projects within the pulp and paper industry, including industrial cooling and industrial power conversion, production, and transmission. Data Center Cooling The data center cooling business provides sustainable cooling solutions for data center markets in North America, EMEA, and Asia, including complete system design, controls, maintenance and monitoring. The company provides data center cooling solutions that feature low global warming potential refrigerants, free cooling technology, and lower water consumption, enabling the company’s customers and end-users to meet their environmental and sustainability goals. Data center products consist of IT cooling solutions, including precision air conditioning units for data center applications; computer room air conditioning (‘CRAC’) and computer room air handler (‘CRAH’) units; hybrid fan coils; fan walls; chillers; condensers; and condensing units. In addition, the company’s data center business sells replacement parts, maintenance service and control solutions for existing equipment and new building management controls and systems. This business serves data center management customers, including large colocation, cloud service providers and hyperscalers, as well as customers in the commercial and industrial sectors, such as telecommunications, healthcare and commercial real estate. Performance Technologies segment The Performance Technologies segment provides products and solutions that enhance the performance of customer applications and develops solutions that increase fuel economy and lower emissions in light of increasingly stringent government regulations. The Performance Technologies segment designs and manufactures air- and liquid-cooled technology for vehicular, stationary power, and industrial applications. In addition, the Performance Technologies segment provides advanced thermal solutions to zero-emission and hybrid commercial vehicle and automotive customers and coating products and application services. The Performance Technologies segment has strategically aligned its teams around three primary market-based verticals: air-cooled applications; liquid-cooled applications, and advanced solutions. Air-Cooled Applications The air-cooled applications business provides air-cooled heat exchangers and modules for vehicular, stationary power, and industrial applications. This business primarily serves the commercial vehicle, off-highway and power generation markets in North America, Brazil, Europe, China, India and South Korea. It primarily sells powertrain cooling products, such as radiators, condensers, engine cooling modules, charge air coolers, fan shrouds, and surge tanks. Its customers include commercial, medium- and heavy-duty truck and engine manufacturers; construction, agricultural, and mining equipment and engine manufacturers; and industrial manufacturers of material handling equipment, generator sets and compressors. Liquid-Cooled Applications The liquid-cooled applications business provides liquid-cooled heat exchangers for engine, stationary power, and industrial applications. This business primarily serves the automotive, commercial vehicle and off-highway markets in North America, Brazil, Europe, China, and India. Its products and solutions include aluminum and stainless steel engine oil coolers, exhaust gas recirculation (‘EGR’) coolers, liquid charge air coolers, transmission and retarder oil coolers, fuel coolers, and condensers. Its customers include automobile and light truck OEMs; commercial, medium- and heavy-duty truck and engine manufacturers; Tier-1 filter and front-end module manufacturers and assemblers; and construction and agricultural equipment manufacturers. Advanced Solutions The advanced solutions business provides thermal management systems and components for electric vehicles, and factory-applied and aftermarket coating products and application services. Products and solutions for zero-emission and hybrid vehicles, primary sold to the commercial vehicle, bus and specialty vehicle, off-highway and automotive markets in North America and Europe, include complete battery thermal management systems, electronics cooling packages, battery chillers, battery cooling plates, coolers and casings for electronics cooling, and coolers for electric axles (‘e-axles’). Customers for these products include commercial vehicle, bus and specialty vehicle, off-highway, and automotive OEMs, e-axle producers, power electronics providers, and electric vehicle startup companies. The company’s advanced solutions business also provides coatings products and application services to the HVAC&R markets in North America and Europe. The company’s coatings products are designed to extend the life of equipment and components by protecting against corrosion and foreign matter. Customers for these products and services include manufacturers of commercial and residential HVAC and refrigeration systems, and distributors, contractors, and end users of HVAC&R equipment. Geographic Areas The company maintains administrative organizations in all key geographic regions to facilitate customer support, development and testing, and other administrative functions. The company operates in four continents and within the following countries: North America: The United States and Mexico. South America: Brazil. Europe: Germany, Hungary, Italy, the Netherlands, Serbia, Spain, Sweden, and the United Kingdom. Asia: China, India, South Korea, and the United Arab Emirates. The company’s non-U.S. subsidiaries and affiliates manufacture and sell a number of commercial, industrial and building HVAC&R and vehicular products similar to those produced in the U.S. Exports Export sales from the U.S. to foreign countries were 7 percent in fiscal 2023. The company’s international presence positions it to benefit from the anticipated long-term growth of the global commercial, industrial and building HVAC&R and vehicular markets. Customer Dependence The company’s top customers operate primarily in the commercial vehicle, off-highway, automotive and light vehicle, data center cooling, and commercial air conditioning and refrigeration markets. The company’s top customers include Carrier; Caterpillar; Daimler Truck AG (including Detroit Diesel, Freightliner, Thomas Built Buses, and Western Star Trucks); Deere & Company; Mercedes-Benz Group AG (including AMG, Athlon, and Maybach); Stellantis (including Chrysler, Fiat, PSA-Peugeot-Citroen, and VM Motori); Trane Technologies; Volkswagen AG (including Audi, MAN, Porsche, Scania, and Navistar); and Volvo Group (including Mack Trucks and Renault Trucks). Research and Development The company’s R&D expenditures, including certain application engineering costs for specific customer solutions, totaled $44 million in fiscal 2023. Environmental Matters The majority of the company’s facilities maintain Environmental Management System (‘EMS’) certification to the international ISO14001 standard through independent third-party audits. Seasonal Nature of Business The Climate Solutions segment experiences some seasonality. Sales volume for the company’s Climate Solutions heating products is generally stronger in the company’s second and third fiscal quarters (year ended March 2023), corresponding with demand for these products. Sales to Performance Technologies vehicular OEM customers are dependent upon market demand for new vehicles. However, the company’s second fiscal quarter production schedules are typically impacted by customer summer shutdowns and the company’s third fiscal quarter is affected by holiday schedules. History Modine Manufacturing Company was founded in 1916. The company was incorporated under the laws of the state of Wisconsin in 1916.