Modine Manufacturing Company (NYSE: MOD), a diversified global leader in thermal management technology and solutions, today reported financial results for the third quarter ended December 31, 2019.
Third Quarter Highlights:
- Net sales of $473.4 million decreased 12 percent from the prior year
- Operating income declined to $8.2 million and adjusted operating income to $24.0 million
- Earnings per share of $0.02 and adjusted earnings per share of $0.37
- Raised adjusted EPS guidance range for fiscal 2020 due to lower expected tax rate, confirmed sales and adjusted operating income guidance
- Progressed automotive separation and exit strategy, plan to report automotive segment in fiscal 2021
“As we anticipated, the sharp declines in key end markets resulted in lower vehicular sales and sales volume declined to our refrigeration and data center customers,” said Modine President and Chief Executive Officer, Thomas A. Burke. “We quickly responded to these market conditions by implementing comprehensive cost savings initiatives across the organization. We exceeded our earnings expectations for the quarter, in part due to the benefit from these actions.”
Financial Results
Net sales decreased 12 percent in the third quarter to $473.4 million, compared with $541.0 million in the prior year period. The decrease was primarily driven by market-related volume declines in all global markets in the Vehicular Thermal Solutions (“VTS”) segment and lower data center and refrigeration sales in the Commercial and Industrial Solutions (“CIS”) segment. This was partially offset by slightly higher sales in the Building HVAC Systems (“BHVAC”) segment.
Gross profit decreased 20 percent in the third quarter to $73.5 million, primarily driven by volume declines in the VTS and CIS segments. This was partially offset by higher gross profit in the BHVAC segment, which increased 5 percent on higher sales volumes. Overall gross margin decreased 140 basis points during the quarter to 15.5 percent, primarily due to lower margins in the VTS and CIS segments as a result of lower sales volume.
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SOURCE: Modine
